Howmet Aerospace (HWM)
NYSE MKTIndustrialsAerospace & DefenseSnapshot 2026-09-04
$259.27-0.47%
Close 2026-09-04 · 1-day change
NYSE MKTIndustrialsAerospace & DefenseSnapshot 2026-09-04
Intact: The reason to own it still holds.
Howmet Aerospace grows revenue about 10% in 2026. Profit margins near 30%. Free cash flow is strong at $1.75 billion. The acquisition of Consolidated Aerospace adds new products and sales.
Insider selling may show less confidence in future results. The sector faces headwinds. The stock price is expensive with a high PE ratio.
The price is about 31% above our fair value near $209. Analysts expect 18% revenue growth. Our fair value is 32% below the Street median of $308.
Breaks if: acquisition integration delays or revenue contribution miss in 2026
Complete the $1.8 billion acquisition of CAM and integrate it to enhance Fastening Systems segment growth and margins.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This is a durable compounder investment. HWM has shown strong revenue growth and effective management execution, but faces sector headwinds that could impact its performance in the near term.
The current valuation of HWM is considered expensive compared to its peers. The market seems to expect continued strong performance, but there is a notable expectations gap, indicating that not all potential risks are fully priced in.
Management is on track to achieve approximately 10% revenue growth in 2026, and recent financial performance has been strong. However, there is a moderate risk due to past performance issues, which could affect future results.
The thesis hinges on the performance of sector bellwethers like SPCX, GE, and RTX. If these companies continue to perform well, it could provide a favorable backdrop for HWM. Conversely, any negative guidance from these peers could pose risks.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The latest earnings beat is a positive factor. However, competition from SpaceX poses a significant threat to HWM's competitive position. Additionally, a sharp drop in HWM's stock price suggests the market may be repricing the thesis.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated as a priority in 3 of last 3 quarters. The $1.8 billion CAM acquisition was completed in 2026-Q2 and integration is on track. Fastening Systems segment revenue grew 37% YoY to $589 million in 2026-Q2, reflecting CAM contributions. Management is delivering on acquisition completion and integration.
“Completed acquisition of CAM on April 6, 2026 for approximately $1.8 billion; integration is on track.”
“Completed acquisition of CAM on April 6, 2026 for approximately $1.8 billion.”
“Secured financing for the acquisition of Consolidated Aerospace Manufacturing, LLC (CAM).”
Breaks if: free cash flow falls below $1.5 billion in FY26
Generate strong free cash flow to support growth investments, debt reduction, dividends, and share repurchases.
Stated as a priority in 6 of last 6 quarters. Free cash flow increased from $134M in 2025-Q1 to $479M in 2026-Q2. Year to date through July 2026, $800M of common stock repurchases were completed, exceeding 2025 total. Management is delivering strong cash generation and disciplined capital allocation.
“Free cash flow performance was excellent at $479 million... enabled $800 million in common stock repurchases year to date.”
“Free cash flow performance was outstanding at $359 million after spending $94 million in capital expenditures.”
“Free Cash Flow 1 $1.550B $1.600B $1.650B”
“Free Cash Flow 1 $1.175B $1.225B $1.275B”
“Generated $344 million of free cash flow”
“Generated $134 million of free cash flow”
Breaks if: gross margin falls below 28% in FY26
Breaks if: YoY revenue growth falls below 7% in FY26
Deliver approximately 10% revenue growth in 2026 driven by growth in commercial aerospace, defense aerospace, and gas turbines markets.
Stated as a priority in 6 of last 6 quarters. Revenue grew from $1.94B in 2025-Q1 to $2.55B in 2026-Q2 (+24% YoY in 2026-Q2). Full year 2026 revenue guidance is approximately $10.05B, up about 10% year over year. Management consistently emphasizes growth across all major markets and the trajectory is delivering.
“Revenue up 24% Year over Year, Organic Growth 21%; ... Looking ahead, Howmet is well positioned, with all our major markets in growth mode.”
“Revenue up 19% Year over Year; ... Looking ahead, we see a robust growth outlook in the key markets Howmet serves.”
“FY 2026: Revenue growth guidance at approximately 10%”
“2025 Preliminary Revenue Guidance: Up Approximately 7.5% Year over Year”
“Full Year 2025 Guidance: Raised on All Metrics”
“Full Year 2025 Guidance: Includes current assumptions of tariff impacts”
Overall, HWM appears to be navigating its challenges well, but its future performance will depend on broader sector dynamics. Not investment advice.