Howmet Surges 33.7% in 6 Months: Is the Stock Still Worth Buying?

Group 1 - Howmet Aerospace Inc. (HWM) has seen a stock price increase of 33.7% over the past six months, significantly outperforming the S&P 500's growth of 0.7% and the aerospace defense industry's decline of 8.5% [1][2] - The stock closed at $126.51, trading below its 52-week high of$140.55 and above its 52-week low of $62.80, indicating solid upward momentum and price stability [3] - The company is benefiting from strong momentum in the commercial aerospace market, with a 12.9$852.2 billion in funding, a 3.3% increase from fiscal 2024, which supports Howmet's growth in defense contracts [9] - Howmet expects to generate revenues between $7.93 billion and$8.13 billion in 2025, reflecting an 8% year-over-year growth at the midpoint [10] Group 3 - The company has a strong liquidity position, with cash equivalents and receivables totaling $564 million and a free cash flow of$977 million in 2024 [10] - In 2024, Howmet paid $109 million in dividends and repurchased$500 million in shares, with a 25% dividend increase announced for January 2025 [11] - The Zacks Consensus Estimate for Howmet's 2025 earnings has risen by 3.2% to $3.27 per share, indicating a year-over-year growth of 21.6% [12] Group 4 - Despite positive growth prospects, Howmet's stock is trading at a forward P/E ratio of 37.00X, higher than the industry average of 22.31X, which may pose a valuation concern [13] - The company's strong performance in both commercial and defense aerospace markets positions it favorably for future growth, supported by a solid liquidity position and shareholder-friendly policies [15][16]