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][4] - 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 influenced by brokerage analysts and company management [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 pillars: Agreement, Magnitude, Upside, and Surprise, categorizing stocks into five groups from "Strong Buy" to "Strong Sell" [9] Stock Spotlight: Huntington Ingalls Industries (HII) - Huntington Ingalls Industries, based in Newport News, VA, specializes in designing and building nuclear-powered ships for the U.S. Navy and Coast Guard [11] - Since being added to the Focus List at $155.20 per share on May 9, 2016, HII's shares have increased by 62.97% to $252.93 [12] - HII has received positive earnings estimate revisions, with the Zacks Consensus Estimate for fiscal 2025 increasing by $0.11 to $14.42, and an expected earnings growth of 3.3% for the current fiscal year [12]

Core Insights - HII's summer interns are engaged in a research project focused on identifying the top use cases for artificial intelligence within the company's corporate office [1][2] - The initiative aims to enhance current processes at HII's headquarters, addressing the increasing demand for ships and the challenges in manufacturing labor and rising wages in the industry [2] Company Initiatives - The intern-led project involved conducting research, interviews, and surveys across departments to develop a comprehensive presentation for senior leadership [2] - HII emphasizes the importance of internships in developing future leaders for the shipbuilding industry, highlighting the need to attract talented individuals to tackle current and future challenges [2][6] Internship Program - HII offers summer internships across its corporate office and three divisions: Ingalls Shipbuilding, Mission Technologies, and Newport News Shipbuilding, with interns working full-time for 10 consecutive weeks [6] - Competitive pay and housing assistance are provided in select locations to attract a larger pool of interns, which is seen as beneficial for both the company and the interns [7] Company Overview - HII is a global defense provider and the largest military shipbuilder in the U.S., with a history of over 135 years in advancing national security [8][9] - The company employs approximately 44,000 individuals and focuses on delivering critical capabilities, including ships, uncrewed systems, cyber solutions, and AI/ML technologies [9]

Core Insights - Investors are evaluating Huntington Ingalls (HII) and Airbus Group (EADSY) for potential undervalued stock opportunities in the Aerospace - Defense sector [1] Valuation Metrics - HII has a forward P/E ratio of 17.93, while EADSY has a forward P/E of 29.43 [5] - HII's PEG ratio is 1.59, indicating a more favorable valuation compared to EADSY's PEG ratio of 7.30 [5] - HII's P/B ratio stands at 2.13, significantly lower than EADSY's P/B of 7.28 [6] - Based on these valuation metrics, HII is rated with a Value grade of B, while EADSY has a Value grade of C [6] Earnings Outlook - Both HII and EADSY currently hold a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions and improving earnings outlooks [3]

Core Viewpoint - Huntington Ingalls Industries (HII) is positioned as the exclusive designer and builder of nuclear-powered aircraft carriers in the U.S., showcasing strong order growth and a robust backlog, making it an attractive investment opportunity in the aerospace-defense industry [1]. Growth Outlook & Financial Performance - The Zacks Consensus Estimate for HII's 2025 earnings per share (EPS) has increased by 1.2% to $14.42 [2] - The total revenue estimate for HII in 2025 is $11.91 billion, reflecting a year-over-year growth of 3.3% [2] - HII's earnings growth rate over the next three to five years is projected at 11.3%, with an average earnings surprise of 4.20% over the past four quarters [2] Market Position & Operations - HII is the sole designer and manufacturer of nuclear-powered aircraft carriers in the U.S., accounting for over 70% of the active Navy fleet [3][7] - In Q1 2025, HII launched DDG 129, christened LPD 30, and began fabricating LPD 32, with plans to complete sea trials for DDG 1000 and deliver DDG 128 and LHA 8 in 2026 [3] Backlog and Order Growth - HII secured new contract awards worth nearly $2.1 billion in Q1 2025, increasing its total backlog to $48.05 billion as of March 31, 2025, indicating strong future revenue potential [4][7] Shareholder Returns - HII has been enhancing shareholder value through dividends, currently offering a quarterly dividend of $1.35 per share, leading to an annualized dividend of $5.40 and a dividend yield of 2.09% [5] Financial Ratios - HII's return on equity (ROE) stands at 12.26%, surpassing the industry average of 10.73%, indicating effective fund utilization [6] - The company's total debt to capital ratio is 40.15%, better than the industry's average of 52.08%, with a times interest earned (TIE) ratio of 7.3, suggesting strong capability to meet interest obligations [8] Stock Performance - HII shares have increased by 12.8% over the past month, outperforming the industry's growth of 6.5% during the same period [9]

Core Viewpoint - HII is set to release its second quarter 2025 financial results on July 31, 2025, and will host an earnings conference call at 9 a.m. Eastern time on the same day [1]. Group 1: Financial Results Announcement - HII will announce its second quarter 2025 financial results on July 31, 2025 [1]. - An earnings conference call will take place at 9 a.m. Eastern time, which will be webcast live on HII's website [1][2]. - Participants in the call will include Chris Kastner, president and CEO, and Tom Stiehle, executive vice president and chief financial officer [2]. Group 2: Company Overview - HII is a global, all-domain defense provider focused on delivering powerful ships and solutions to enhance national security [3]. - As the largest military shipbuilder in the U.S., HII has a history of over 135 years in advancing national security [4]. - The company offers critical capabilities that include ships, unmanned systems, cyber, ISR, AI/ML, and synthetic training [4]. - HII is headquartered in Virginia and employs a workforce of 44,000 [4].

Core Points - HII announced the launch of the Virginia-class submarine Arkansas (SSN 800) at its Newport News Shipbuilding division, marking a significant milestone in submarine construction [1][2] - The Arkansas is the 27th Virginia-class submarine and the 13th delivered by HII, showcasing advanced capabilities that enhance firepower, maneuverability, and stealth [3] Company Commitment - HII is committed to increasing submarine construction cadence and throughput for the U.S. Navy, emphasizing the importance of nuclear-powered submarines for national security [2] Historical Significance - The submarine's sponsors are the six women of the Little Rock Nine, symbolizing a historic moment in the desegregation of schools in the U.S. [2] Company Overview - HII is the largest military shipbuilder in the U.S. with over 135 years of history in advancing national security, employing a workforce of 44,000 [6][7] - The company provides critical capabilities across various domains, including ships, unmanned systems, cyber, ISR, AI/ML, and synthetic training [7]

Core Insights - HII's Ingalls Shipbuilding division hosted its third annual educator externship, involving 15 educators from Mississippi Gulf Coast school districts, aimed at strengthening workforce pipelines and aligning education with national defense needs [1][2]. Group 1: Externship Program - The externship program took place from June 9-20 and included facility tours, job shadowing, and discussions with experienced shipbuilders and leadership [2]. - A new feature this year was a virtual welding lab training exercise, allowing educators to learn basic welding techniques in a simulation-based environment [2]. Group 2: Workforce Development Initiatives - Ingalls Shipbuilding is committed to investing in local workforce development through various programs, including the Shipbuilder Academy, technical training in high schools, and partnerships with community colleges [4]. - The company supports enterprise-wide commitments to hands-on apprentice training and collaborations with two- and four-year colleges and universities [4]. Group 3: Company Overview - HII is the largest military shipbuilder in the U.S. with over 135 years of history in advancing national security, delivering capabilities from ships to unmanned systems and cyber solutions [8]. - The company has a workforce of 44,000 and is headquartered in Virginia [8].

Core Insights - C3.ai's partnership with defense contractor HII is expected to significantly enhance its growth in the government sector, particularly in shipbuilding operations for the U.S. Navy [1][2] - The collaboration aims to integrate C3.ai's AI technology into HII's operations, addressing critical challenges in national defense, such as shipbuilding delays [4][11] Partnership and Expansion - The partnership builds on a successful pilot program at HII's Ingalls Shipbuilding, where C3.ai's algorithms optimized scheduling and labor allocation [3] - The deployment will initially focus on improving planning and throughput for various naval vessels, including amphibious ships and submarines [3][11] Federal Business Growth - C3.ai has recently secured a $450 million contract ceiling with the U.S. Air Force, expanding its presence in the defense sector [5][6] - The company is positioning itself as a key vendor for AI-driven operational intelligence in mission-critical applications, which is crucial for its long-term growth strategy [6][12] Financial Performance - In fiscal Q4, C3.ai reported revenues of $108.7 million, reflecting a 26% year-over-year growth [7] - Total revenues for fiscal 2025 reached $389.1 million, marking a 25% increase year-over-year, with subscription services comprising 96% of total revenues [8][9] Partner Ecosystem and Market Position - C3.ai's partner-supported bookings surged by 419% year-over-year in fiscal Q4, indicating strong demand for its solutions [10] - The renewal of a key alliance with Baker Hughes has generated over $500 million in revenue, enhancing C3.ai's credibility in industrial markets [9] Innovation and Differentiation - C3.ai's Agentic AI platform is deployed in over 100 use cases, providing ready-to-use applications for specific problems, distinguishing it from other AI vendors [13][14] - The company's application-first model is increasingly appealing to enterprise buyers seeking immediate solutions [14] Share Price and Valuation - C3.ai shares have increased by 11.8% over the past three months, outperforming the industry average [15] - Despite recent gains, C3.ai is priced at a discount compared to its industry, with a forward price-to-sales ratio of 6.81 [19] Strategic Outlook - The partnership with HII represents a strategic inflection point for C3.ai, contributing to strong revenue growth and an expanding partner ecosystem [21]

Core Insights - HII has received an order from Hitachi for over a dozen REMUS 300 small uncrewed undersea vehicles (SUUVs), marking a significant milestone in the commercial program [1][3] - The REMUS 300 platform is designed for multi-mission adaptability and has been successfully integrated into various naval operations globally [1][6] - This procurement strengthens the long-standing relationship between the U.S. and Japan, enhancing interoperability with allied forces [2][3] Company Overview - HII is a leading global defense provider with a focus on delivering advanced naval capabilities, including unmanned systems and cyber solutions [8][9] - The company has a history of over 135 years in advancing U.S. national security and employs a workforce of 44,000 [9] Product Details - The REMUS 300 platform features an open-architecture design that allows for rapid payload integration and mission-specific configurations, ensuring operational relevance and cost efficiency [7] - HII has sold more than 700 REMUS vehicles to over 30 countries, with over 90% of units delivered in the past 23 years still in service, highlighting the platform's durability [7]

Core Insights - HII and C3 AI have formed a strategic partnership to enhance digital technologies and apply AI to improve shipbuilding throughput at HII's Newport News and Ingalls Shipbuilding divisions [1][5][8] Company Overview - HII is the largest military shipbuilder in the U.S., with a history of over 135 years in advancing national security and a workforce of 44,000 [10] - C3 AI specializes in Enterprise AI application software, providing integrated products for developing and deploying AI applications [11] Partnership Details - The partnership aims to integrate AI solutions across various shipbuilding operations, including planning, operations, supply chain, and labor allocation, to accelerate production and support U.S. Navy fleet readiness [5][6] - Initial efforts will focus on enhancing planning and scheduling at HII's divisions, specifically for amphibious ships, destroyers, nuclear-powered aircraft carriers, and submarines [7] Technological Implementation - The collaboration builds on a previous six-month deployment of C3 AI's technology at Ingalls Shipbuilding, which utilized complex algorithms to optimize work schedules, resulting in significant improvements in schedule performance [6][8] - The deployment of the C3 Agentic AI Platform will be scaled across HII shipyards to further enhance operational efficiency [6]