Core Points - HII has christened the USS Jeremiah Denton (DDG 129), the third Flight III Arleigh Burke-class destroyer built at its Ingalls Shipbuilding division [1][3] - The ship is named after former U.S. Senator Jeremiah Denton Jr., a Vietnam War veteran known for his heroism as a prisoner of war [2] - The christening ceremony highlighted the importance of naval ships and recognized the shipbuilding workforce as a vital national asset [3][6] Company Overview - HII is the largest military shipbuilder in the U.S. with over 135 years of history in advancing national security [11] - The company employs a workforce of 44,000 and delivers critical capabilities ranging from ships to unmanned systems and cyber solutions [12] - HII's mission is to provide powerful ships and all-domain solutions to protect peace and freedom globally [11] Industry Insights - Flight III Arleigh Burke-class destroyers represent the next generation of surface combatants with enhanced capabilities, including advanced radar and combat systems [8] - Ingalls Shipbuilding has delivered 35 Arleigh Burke-class destroyers to the U.S. Navy, with five Flight IIIs currently under construction [9]

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Global Aerospace & Defense - **Recent Events**: Israel's military strikes against Iran's nuclear program and military facilities have escalated tensions in the region, leading to significant military actions by both Israel and the US, including the use of B-2 bombers and GBU-57 bombs against Iranian nuclear sites [1][2]. Core Insights and Arguments - **Impact on Defense Spending**: Historical patterns indicate that geopolitical crises often lead to increased defense spending and a positive trajectory for defense stocks. However, the ultimate impact depends on the long-term geopolitical environment and military threats [2][3]. - **Historical Context**: Past events, such as the 9/11 attacks and the Gulf Wars, resulted in sustained growth in defense stocks relative to the S&P 500 due to ongoing geopolitical tensions and increased US defense spending [3][4]. - **Temporary vs. Extended Impact**: - Temporary impacts are observed when conflicts are confined, leading to initial increases in defense stock prices that are later reversed. This was seen during the 2023 Hamas attacks on Israel and Russia's invasion of Georgia [5][26]. - Extended impacts occur when conflicts lead to sustained increases in defense budgets, as seen with the Russian invasion of Ukraine, which has prompted a significant rise in European defense spending [4][14][22]. Current Market Dynamics - **Recent Stock Performance**: Following Israel's attacks on June 13, US defense stocks initially rose due to fears of instability. However, as Israel dismantled Iran's military capabilities, defense stocks gave back their gains [6][33]. - **Future Outlook**: The potential outcomes for Iran's political landscape could significantly influence defense spending. A stable regime could reduce military threats and spending, while a failed state scenario could lead to increased instability and higher defense budgets [11][12][33]. Investment Implications - **Stock Ratings**: - Outperform ratings were given to L3Harris (TP $273), Boeing (TP $249), BAE Systems (TP 1,890p), Dassault Aviation (TP €305), and Leonardo (TP €50) [10]. - Market-Perform ratings were assigned to General Dynamics (TP $295), Huntington Ingalls (TP $257), Lockheed Martin (TP $540), RTX (TP $136), Northrop Grumman (TP $531), and Thales (TP €247) [10]. - **Valuation Metrics**: The report includes adjusted EPS and P/E ratios for various defense companies, indicating a mixed performance outlook for the sector [9]. Additional Considerations - **Geopolitical Risks**: The potential for ongoing US involvement in the region or the emergence of new threats from Russia or China could lead to prolonged instability and increased global defense spending [7][12]. - **European Defense Spending**: The conflict in Ukraine has led to a significant re-rating of European defense stocks, with expectations of stronger spending despite limited visibility on budget specifics [22]. This summary encapsulates the key points discussed in the conference call, highlighting the implications of recent geopolitical events on the defense industry and stock performance.

NEWPORT NEWS, Va., June 23, 2025 (GLOBE NEWSWIRE) -- HII's (NYSE: HII) Newport News Shipbuilding division moved another step closer toward delivery of Virginia-class submarine Massachusetts (SSN 798) when the first meal was recently served aboard the submarine. Massachusetts is currently pierside at NNS and is in the final stages of construction and testing. To celebrate the first meal, the crew welcomed the ship's sponsor, Sheryl Sandberg, founder, Lean In, and former chief operating officer of Meta (forme ...

Core Insights - The Zacks Focus List is a curated portfolio of 50 stocks aimed at long-term investors, expected to outperform the market over the next 12 months [3][5] - The Focus List has demonstrated strong past performance, gaining 13.85% in 2020 compared to the S&P 500's 9.38%, and a cumulative return of 2,519.23% since February 1, 1996, against the S&P's 854.95% [5] - The selection methodology relies on earnings estimate revisions, which are critical for predicting future stock performance [6][7] Focus List Methodology - Stocks are chosen based on the power of earnings estimate revisions, which are derived from brokerage analysts' assessments of companies [6] - The Zacks Rank, a proprietary stock-rating model, utilizes changes in quarterly earnings expectations to guide investment decisions [8] - The Zacks Rank is based on four factors: Agreement, Magnitude, Upside, and Surprise, classifying stocks into five groups from "Strong Buy" to "Strong Sell" [9] Focus List Spotlight: Huntington Ingalls Industries (HII) - Huntington Ingalls Industries, based in Newport News, VA, specializes in designing and building nuclear-powered and non-nuclear ships for the U.S. Navy and Coast Guard [11] - HII was added to the Focus List at $155.20 per share and has since increased by 50.82% to $234.08 [12] - Recent analyst revisions indicate a positive outlook, with nine analysts raising earnings estimates for fiscal 2025, and the Zacks Consensus Estimate increasing by $0.46 to $14.31 [12]

Core Insights - HII's Mission Technologies division has been awarded a contract to provide live training solutions to the U.S. Army, with a ceiling of $379 million [1][2] - The contract will support the Army's Live Training, Ranges and Combat Training Centers (LTRaC) and includes modernization and development efforts for live-fire ranges [2][3] - HII is recognized as the largest military shipbuilder in the U.S. and has a long history of contributing to national security [4][5] Company Overview - HII is a global defense provider focused on delivering advanced ships and all-domain solutions to enhance national security [4] - The company employs a workforce of 44,000 and has over 135 years of experience in the defense sector [5] - HII specializes in multi-domain training, providing realistic live and synthetic training environments for mission rehearsal [3][5]

Core Points - HII's Ingalls Shipbuilding division honored the 2025 class of master shipbuilders for their 40 years of continuous service, recognizing their contributions to national security and workforce development [1][2] - The ceremony featured a tribute video showcasing personal stories and career highlights of the master shipbuilders, emphasizing their shared commitment to building advanced naval ships [2] Company Overview - HII is the largest military shipbuilder in the U.S. with over 135 years of history in advancing national security, providing capabilities from ships to unmanned systems and cyber solutions [10] - The company employs a workforce of 44,000 and is dedicated to delivering powerful ships and all-domain solutions to protect peace and freedom globally [9][10] Employee Recognition - Master shipbuilders represent the highest level of skill and dedication within Ingalls Shipbuilding, with employees like Larry Stevens and Denise Quave reflecting on their experiences and the importance of mentoring the next generation [5][6][7] - The recognition of master shipbuilders highlights the company's commitment to workforce culture and community impact [2][5]

Core Viewpoint - Huntington Ingalls (HII) has been upgraded to a Zacks Rank 2 (Buy), reflecting an upward trend in earnings estimates, which significantly impacts stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates in determining near-term stock price movements, making it a valuable tool for investors [2][4]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in buying or selling actions that influence stock prices [4]. Business Outlook for Huntington Ingalls - The upgrade indicates a positive outlook for Huntington Ingalls' earnings, suggesting potential buying pressure and an increase in stock price [3][5]. - Analysts have raised their earnings estimates for Huntington Ingalls, with the Zacks Consensus Estimate increasing by 3.2% over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [7]. - The upgrade to Zacks Rank 2 places Huntington Ingalls in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10].

Core Insights - HII showcased its defense technology portfolio at the DefenseTech LIVE event, emphasizing collaboration and innovation in national security and defense [1][2] - The event featured hundreds of government and industry leaders, highlighting HII's interactive technology showcase and strategy sessions focused on enhancing mission readiness [2][5] - HII's Mission Technologies division is committed to advancing defense capabilities across all domains, including land, sea, air, space, and cyberspace [7][9] Technology Focus - Key session topics included next-generation defense innovation, combined joint all-domain command and control, unmanned maritime operations, full-spectrum cyber operations, and battlefield electronic warfare [6] - HII's technology portfolio includes AI, big data, unmanned systems, cyber operations, and spectrum engineering, aimed at enabling mission readiness [7][11] Company Overview - HII is the largest military shipbuilder in the U.S. with over 135 years of experience in advancing national security [10] - The company employs a workforce of 44,000 and is dedicated to delivering powerful ships and all-domain solutions to protect peace and freedom globally [9][10]

Core Insights - The article compares Huntington Ingalls (HII) and RTX (RTX) to determine which stock is more attractive for value investors [1] Valuation Metrics - HII has a forward P/E ratio of 15.61, while RTX has a forward P/E of 23.20 [5] - HII's PEG ratio is 1.41, indicating a more favorable valuation compared to RTX's PEG ratio of 2.50 [5] - HII's P/B ratio is 1.84, compared to RTX's P/B of 2.92, suggesting HII is undervalued relative to its book value [6] Investment Ratings - HII currently holds a Zacks Rank of 2 (Buy), while RTX has a Zacks Rank of 3 (Hold), indicating a stronger outlook for HII [3][6] - HII's Value grade is B, whereas RTX's Value grade is C, further supporting HII as the more attractive option for value investors [6]

Investment Rating - The report assigns a "Buy" rating on Huntington Ingalls Industries Inc. (HII) stock, with a 12-month price target of $265, indicating an upside potential of 16.3% from the current price of $227.84 [12]. Core Insights - The report highlights a substantial increase in support for U.S. Navy shipbuilding, driven by proposed defense reconciliation legislation that includes approximately $34 billion for defense shipbuilding efforts [2][8]. - HII is experiencing a strong demand for ships, with a backlog of $48 billion, and is focused on improving throughput by addressing labor and supply chain challenges [6][7]. - The company anticipates a path to improve margins over the medium term, aiming to return to shipbuilding margins of 9-10% as it transitions to more recent contracts [7]. Summary by Sections Management Meeting Takeaways - The management meeting included discussions on defense reconciliation legislation, Navy contract modifications, and HII's strategies for navigating labor and supply chain issues [1]. - The new administration's focus on enhancing U.S. shipbuilding capacity aligns with HII's re-baselined cost and completion expectations [1]. Defense Reconciliation - The proposed defense reconciliation includes $34 billion for shipbuilding, with various allocations for industrial base investment, procurement of vessels, and unmanned vessels [2][4]. - The actual disbursement of these funds may take several years, but there is optimism for a more rapid appropriation due to the current geopolitical landscape [2]. Labor and Supply Chain - Labor and supply chain constraints are the primary factors limiting HII's throughput, with ongoing efforts to hire experienced workers and improve retention through training and competitive wages [6][7]. - Recent contract modifications from the U.S. Navy, including an $18.5 billion contract for Virginia-class submarines, provide additional support for workforce development [6]. Margins and Free Cash Flow - HII is confident in its 2025 guidance, expecting to improve margins as it moves away from pre-COVID contracts that faced cost inflation [7]. - The company aims to achieve a shipbuilding margin of 9-10% in the future, supported by recent funding actions for workforce improvement [7]. Timeline of Major Shipbuilding Commentary - The report outlines significant actions taken by the Trump administration to enhance U.S. shipbuilding capabilities, including executive orders and proposed legislation aimed at increasing domestic shipbuilding activity [8].