Howmet Aerospace Intrinsic Stock Value – HOWMET AEROSPACE Reports 44.2% Increase in Revenue for FY2022 Q4
April 5, 2023
Earnings Overview
On February 14 2023, HOWMET AEROSPACE ($NYSE:HWM) reported their FY2022 Q4 earnings with total revenue of USD 111.0 million, representing an increase of 44.2% from the same period in the prior year. Net income for the quarter also saw a 17.7% increase to USD 1513.0 million.
Transcripts Simplified
Commercial aerospace revenue increased by 29% year-over-year, driven by engine products, engineered structures and the narrow-body recovery. Defense Aerospace revenue was up 13% in the fourth quarter. Commercial transportation revenue was up 12% year-over-year, driven by higher aluminum prices and higher volumes. Industrial and other markets were essentially flat for the fourth quarter.
Earnings per share was $1.40 for the year, up 39% year-over-year. Free cash flow for the year was a record $540 million, including an inventory build of approximately $235 million, primarily for the commercial aerospace recovery. Net headcount additions in the fourth quarter were minimal, but the company hired approximately 1,000 new employees to offset Q4 attrition and absorbed incremental training and production costs.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Howmet Aerospace. More…
| Total Revenues | Net Income | Net Margin |
| 5.66k | 467 | 10.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Howmet Aerospace. More…
| Operations | Investing | Financing |
| 733 | -135 | -526 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Howmet Aerospace. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 10.26k | 6.65k | 8.74 |
Key Ratios Snapshot
Some of the financial key ratios for Howmet Aerospace are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -26.4% | -15.9% | 14.7% |
| FCF Margin | ROE | ROA |
| 9.5% | 15.2% | 5.1% |
Share Price
This increase was marked by the company’s stock opening at $40.3 and closing at $43.0, up 4.7% from the prior closing price of 41.1. The impressive increase in revenue can be attributed to the company’s growth in aerospace components and services sector. With the acquisition, HOWMET AEROSPACE has added high-performing operations to its portfolio, including several aircraft components and services businesses.
In addition, the company has expanded its global footprint, allowing it to capitalize on aerospace manufacturing opportunities around the globe. The company is also making strides in the development of new products and applications. Furthermore, HOWMET AEROSPACE is also developing a suite of advanced software applications to further enhance its operations. Overall, this report of increased revenue for HOWMET AEROSPACE further solidifies the company’s position as a leader in the aerospace components and services sector. With its strategic acquisitions, innovative product offerings, and global reach, the company has created an impressive platform for long-term success. Live Quote…
Analysis – Howmet Aerospace Intrinsic Stock Value
At GoodWhale, we have conducted an extensive analysis of HOWMET AEROSPACE‘s fundamentals, and based on our proprietary Valuation Line, we have determined that the fair value of HOWMET AEROSPACE shares is approximately $32.2. However, at the time of writing, HOWMET AEROSPACE is trading at $43.0, which we consider to be overvalued by 33.6%. More…
Peers
Its main competitors are Rolls-Royce Holdings PLC, General Dynamics Corp, and Raytheon Technologies Corp.
– Rolls-Royce Holdings PLC ($LSE:RR.)
Rolls-Royce Holdings PLC is a British multinational engineering company incorporated in February 2011 that owns Rolls-Royce, a business founded in 1904 which today designs, manufactures and distributes power systems for aviation and other industries.
The company has a market cap of 7.25B as of 2022 and a Return on Equity of 21.06%. Rolls-Royce is a global leader in the design, manufacture and distribution of power systems for aviation and other industries. The company’s products and services power more than 35,000 aircraft and over 10,000 ships worldwide.
– General Dynamics Corp ($NYSE:GD)
General Dynamics Corporation is an American aerospace and defense conglomerate company formed by mergers and divestitures, and as of 2012, it is the fifth largest defense contractor in the world. It is headquartered in West Falls Church, The company has a market cap of 68.15B as of 2022 and a Return on Equity of 15.38%. The company is involved in the design, development, and manufacture of products and services for the aerospace and defense industries.
– Raytheon Technologies Corp ($NYSE:RTX)
Raytheon Technologies Corporation is an aerospace and defense company that provides products and services for the commercial, military, and government markets. The company has a market cap of 140.18B as of 2022 and a Return on Equity of 5.82%. Raytheon Technologies is a technology leader in defense, security, and commercial aerospace. The company’s products and services include aircraft engines, radar, and other electronic systems.
Summary
Investors in Howmet Aerospace should be pleased with the company’s strong financial results for their fourth quarter of fiscal year 2022. Revenue was up 44.2% year-over-year, hitting USD 111.0 million, while net income increased 17.7% to USD 1513.0 million. This indicates that the company’s strategies are working and that investors can expect continued strong performance in the coming quarter. With the stock price increasing on the news, now may be a good time to consider investing in Howmet Aerospace.
