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Howmet (HWM) Stock Declines While Market Improves: Some Information for Investors

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The latest trading session saw Howmet (HWM - Free Report) ending at $99.30, denoting a -0.42% adjustment from its last day's close. The stock's performance was behind the S&P 500's daily gain of 0.4%. Meanwhile, the Dow gained 0.62%, and the Nasdaq, a tech-heavy index, added 0.6%.

The maker of engineered products for the aerospace and other industries's stock has climbed by 3.32% in the past month, exceeding the Construction sector's gain of 2.56% and the S&P 500's gain of 1.71%.

Analysts and investors alike will be keeping a close eye on the performance of Howmet in its upcoming earnings disclosure. In that report, analysts expect Howmet to post earnings of $0.65 per share. This would mark year-over-year growth of 41.3%. Meanwhile, the latest consensus estimate predicts the revenue to be $1.86 billion, indicating a 11.89% increase compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $2.59 per share and revenue of $7.48 billion, which would represent changes of +40.76% and +12.58%, respectively, from the prior year.

Investors should also pay attention to any latest changes in analyst estimates for Howmet. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Howmet currently has a Zacks Rank of #2 (Buy).

From a valuation perspective, Howmet is currently exchanging hands at a Forward P/E ratio of 38.51. Its industry sports an average Forward P/E of 21.63, so one might conclude that Howmet is trading at a premium comparatively.

It's also important to note that HWM currently trades at a PEG ratio of 1.49. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Engineering - R and D Services industry was having an average PEG ratio of 1.59.

The Engineering - R and D Services industry is part of the Construction sector. This group has a Zacks Industry Rank of 94, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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