Key Takeaways GE posted 24% revenue growth in Commercial Engines & Services in 2025.RTX logged $10.3B bookings and a record $268B backlog despite supply issues.GE forecasts 14% sales growth for 2026, outpacing RTX's 5.4% outlook.GE Aerospace (GE) and RTX Corporation (RTX) are two prominent names operating in the aerospace and defense industry. As rivals, both companies are engaged in producing highly engineered aircraft components for commercial and military aircraft in the United States and internationally ...

Industry Overview - Ongoing global conflicts and rivalries are driving governments to enhance military capabilities, leading to systematic upgrades in weapons, vehicles, aircraft, missile defense systems, and cyber capabilities [1][4] - Defense priorities are shifting towards artificial intelligence-enabled platforms, cyber and space capabilities, and advanced surveillance systems, which are expected to improve speed, precision, and resilience [2] Defense Spending - U.S. defense spending is projected to reach $1.01 trillion in fiscal 2026, reflecting a 13.4% increase proposed by President Trump, providing the Pentagon with greater flexibility for new orders and program expansions [3] - Sustained government spending and modernization efforts are supporting long-term growth in the defense sector, with multi-year budgets ensuring funding stability [4] Market Growth - The global aerospace and defense market is estimated to reach $1,470.43 billion by 2032, with a compound annual growth rate of 8.2% from 2025 to 2032 [5] Company Highlights - **Archer Aviation**: Focuses on developing hybrid-electric vertical takeoff and landing aircraft for military applications, with a projected 12.6% year-over-year earnings increase for 2026 [7][8] - **GE Aerospace**: Secured a $5 billion contract from the U.S. Air Force, with expected revenue and earnings growth of 11.7% and 13% respectively for 2026 [9][10] - **Howmet Aerospace**: Announced an acquisition of Consolidated Aerospace Manufacturing to enhance its offerings in aerospace and defense, with projected revenue and earnings growth of 11.4% and 19.7% respectively for 2026 [11][12][13]

Core Insights - Howmet Aerospace Inc.'s defense aerospace market is a significant growth driver, with revenues from this segment accounting for 17% of total sales and increasing by 24% year over year in Q3 2025 [1][8] - The Engineered Structures segment reported a 14% year-over-year revenue increase, supported by strong orders for military aircraft spares [2][8] - The House of Representatives passed the FY 2026 Defense Appropriations Act, allocating $831.5 billion, which is expected to enhance Howmet's ability to secure new contracts [3][4] Revenue and Growth - The defense aerospace market's robust performance is attributed to strong orders for engine spares for the F-35 program and legacy fighters like the F-15 and F-16 [1][8] - Howmet is well-positioned for continued demand growth due to a solid pipeline of military aircraft programs [2][4] Competitive Landscape - Textron Inc.'s defense business is gaining momentum with key U.S. military contracts, including a recent contract for Bell 429 helicopters [5] - GE Aerospace's Defense & Propulsion Technologies business is benefiting from rising demand, securing a $5 billion contract from the U.S. Air Force [6] Stock Performance and Valuation - Howmet's shares have increased by 13.7% over the past three months, contrasting with a 3.2% decline in the industry [7] - The company is trading at a forward price-to-earnings ratio of 46.06X, above the industry average of 28.56X, and carries a Value Score of D [9] Earnings Estimates - The Zacks Consensus Estimate for Howmet's 2025 earnings has risen by 2.8% over the past 30 days [10]

Core Insights - Howmet Aerospace Inc.'s defense aerospace market is a significant growth driver, with revenues from this segment accounting for 17% of total sales in Q2 2025, reflecting a 21% year-over-year increase [1][8] - The demand for engine spares, particularly for the F-35 program, and increased orders for fighter jet parts are key contributors to this revenue surge [1][8] - The Engineered Structures segment reported a 5% year-over-year revenue increase, supported by a strong pipeline of military aircraft programs and a robust defense budget [2] Financial Performance - The House of Representatives passed the fiscal year 2026 Defense Appropriations Act, allocating $831.5 billion, which is expected to benefit Howmet's defense business and boost its top line [3] - The Zacks Consensus Estimate for revenues from the defense aerospace market in Q3 2025 is projected at $351 million, indicating a 21.5% year-over-year increase [4] - Howmet's shares have surged 98.9% over the past year, outperforming the industry growth of 24.4% [7] Competitive Landscape - GE Aerospace's Defense & Propulsion Technologies business is also experiencing growth due to rising demand for advanced propulsion systems, securing a $5 billion contract from the U.S. Air Force [5] - Textron Inc.'s defense business is gaining momentum with key U.S. military contracts, including a contract with the Tunisian Air Force for 12 SUBARU Bell 412EPXs [6] Valuation and Estimates - Howmet is trading at a forward price-to-earnings ratio of 48.52X, above the industry average of 29.55X, with a Value Score of B [9] - The Zacks Consensus Estimate for Howmet's 2025 earnings has increased by 0.3% over the past 60 days [10]

Core Insights - Howmet Aerospace Inc. (HWM) is experiencing significant growth in its defense aerospace market, with a 21% year-over-year revenue increase in Q2 2025, accounting for 17% of total sales [1][8] - The Engineered Structures segment also reported a 5% year-over-year revenue increase, driven by strong demand in the defense aerospace sector [2][8] - The recent passage of the fiscal year 2026 Defense Appropriations Act, allocating $831.5 billion, positions Howmet to secure more contracts and enhance its revenue potential [3][4] Segment Performance - The Engineered Structures segment's revenue growth is attributed to increased military funding and demand for engine spares, particularly related to the F-35 program [2][4] - Howmet's defense aerospace market is expected to maintain strong demand momentum due to consistent government support and robust military programs [4] Competitive Landscape - Textron Inc. is also gaining momentum in its defense business, securing contracts with the U.S. military, including a recent deal with the Tunisian Air Force [5] - GE Aerospace's Defense & Propulsion Technologies business is benefiting from rising demand, having secured a $5 billion contract from the U.S. Air Force [6] Financial Performance - Howmet's shares have surged 78.7% over the past year, significantly outperforming the industry growth of 12.1% [7] - The company is currently trading at a forward price-to-earnings ratio of 42.73X, above the industry average of 27.25X, indicating a premium valuation [10] Earnings Estimates - The Zacks Consensus Estimate for HWM's 2025 earnings has been on the rise over the past 60 days, reflecting positive sentiment among analysts [11]

Core Insights - Howmet Aerospace Inc.'s defense aerospace market is a significant driver of overall growth, with a 19% year-over-year revenue increase in Q1 2025, accounting for 17% of total sales [1][8] - The Engineered Structures segment reported an 8% year-over-year revenue increase, bolstered by a 36% rise in defense aerospace sales [2][8] - The U.S. Senate Committee on Appropriations approved a fiscal 2025 Defense Appropriations Act with a total funding of $852.2 billion, a 3.3% increase from fiscal 2024, which is favorable for Howmet's defense aerospace market [3][4][8] Industry Context - Increased military funding enhances Howmet's ability to secure new contracts, particularly with strong momentum in the F-35 program [4] - Competitors like Textron Inc. and GE Aerospace are also experiencing growth in their defense segments, with Textron securing a U.S. Navy contract worth up to $100 million and GE Aerospace benefiting from rising demand for advanced propulsion systems [5][6] Financial Performance - Howmet's shares have surged 127.7% over the past year, significantly outperforming the industry's growth of 20.1% [7] - The company is currently trading at a forward price-to-earnings ratio of 46.77X, above the industry average of 27.53X, indicating a premium valuation [10] - The Zacks Consensus Estimate for Howmet's earnings has been on the rise, with current estimates for Q2 2025 at $0.87 and for the current year at $3.47 [12][13]

Core Insights - Howmet Aerospace Inc. (HWM) is experiencing growth due to an expanding defense budget, which serves as a key growth catalyst for the company [1] Financial Performance - In Q1 2025, revenues from the defense aerospace market increased by 19% year over year, accounting for 17% of HWM's total sales, driven by strong demand for engine spares, particularly for the F-35 program [2] - The Engineered Structures segment reported an 8% year-over-year revenue increase, supported by a 36% rise in defense aerospace sales [2][8] - HWM's shares surged by 114.6% over the past year, significantly outperforming the industry growth of 13.7% [7] Market Environment - The U.S. Senate Committee on Appropriations approved a fiscal 2025 Defense Appropriations Act, allocating $852.2 billion, reflecting a 3.3% increase from fiscal 2024 [3][8] - The increase in military funding positions HWM to secure more contracts, particularly with strong momentum in the F-35 program [4] Competitive Landscape - Textron Inc. (TXT) is gaining momentum in its defense business, securing a U.S. Navy contract worth up to $100 million in Q1 2025 [5] - GE Aerospace's Defense & Propulsion Technologies business is benefiting from rising demand for advanced propulsion systems, securing a U.S. Army IDIQ contract for F110 engines [6] Valuation and Estimates - HWM is trading at a forward price-to-earnings ratio of 45.70X, above the industry average of 26.22X, and carries a Value Score of F [10] - The Zacks Consensus Estimate for HWM's earnings has been on the rise over the past 60 days, with current estimates for the current year at $3.46 and next year at $4.10 [12][13]