Howmet Aerospace Stock: Is HWM Outperforming the Industrial Sector?

Howmet Aerospace Inc. (HWM), headquartered in Pittsburgh, Pennsylvania, provides advanced engineered solutions for the aerospace and transportation industries. Valued at $101.8 billion by market cap, the company offers engines, fasteners, and structures, as well as forged wheels. 

Companies worth $10 billion or more are generally described as “large-cap stocks,” and HWM perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the aerospace & defense industry. HWM's specialization in lightweight metals engineering and manufacturing has solidified its position as a key supplier for aircraft engines and turbines. Through cutting-edge products like advanced airfoils and specialized fasteners, HWM meets the rigorous standards of the aerospace industry, leading to improved performance and efficiency.

Despite its notable strength, HWM slipped 5% from its 52-week high of $267.31, achieved on Mar. 2. Over the past three months, HWM stock has gained 32%, outperforming the Industrial Select Sector SPDR Fund’s (XLI) 9% gains during the same time frame.

Shares of HWM rose 23.9% on a YTD basis and climbed 107.6% over the past 52 weeks, notably outperforming XLI’s YTD gains of 9.6% and 28.7% returns over the last year.

To confirm the bullish trend, HWM has been trading above its 50-day and 200-day moving averages over the past year, experiencing slight fluctuations. 

On Feb. 12, HWM shares closed up more than 6% after reporting its Q4 results. Its adjusted EPS of $1.05 beat Wall Street expectations of $0.97. The company’s revenue was $2.2 billion, beating Wall Street forecasts of $2.1 billion. HWM expects full-year adjusted EPS in the range of $4.35 to $4.55, and revenue ranging from $9 billion to $9.2 billion.

HWM’s rival, TransDigm Group Incorporated (TDG) shares significantly lagged behind the stock, with a 4.6% downtick on a YTD basis and 5.1% losses over the past 52 weeks.

Wall Street analysts are bullish on HWM’s prospects. The stock has a consensus “Strong Buy” rating from the 23 analysts covering it, and the mean price target of $278.30 suggests a potential upside of 9.6% from current price levels.