Here's Why Howmet (HWM) Gained But Lagged the Market Today
The latest trading session saw Howmet (HWM) ending at $102.99, denoting a +0.16% adjustment from its last day's close. The stock fell short of the S&P 500, which registered a gain of 0.97% for the day. Meanwhile, the Dow gained 0.3%, and the Nasdaq, a tech-heavy index, added 1.45%.
Shares of the maker of engineered products for the aerospace and other industries witnessed a gain of 9.76% over the previous month, beating the performance of the Construction sector with its gain of 8.21% and the S&P 500's gain of 5.41%.
The investment community will be closely monitoring the performance of Howmet in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $0.66, reflecting a 43.48% increase from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.85 billion, up 11.83% from the year-ago period.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $2.59 per share and a revenue of $7.47 billion, signifying shifts of +40.76% and +12.54%, respectively, from the last year.
Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Howmet. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.18% higher. As of now, Howmet holds a Zacks Rank of #2 (Buy).
Looking at valuation, Howmet is presently trading at a Forward P/E ratio of 39.63. This expresses a premium compared to the average Forward P/E of 21.16 of its industry.
It is also worth noting that HWM currently has a PEG ratio of 1.49. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As of the close of trade yesterday, the Engineering - R and D Services industry held an average PEG ratio of 1.54.
The Engineering - R and D Services industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 64, which puts it in the top 26% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report