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Huntington Ingalls Industries, Inc. HII

IndustrialsAerospace & DefenseNYSE📅 Scored March 7, 2026
Price at analysis: $400.47
Crucible Score
59.5
C+
Quality × Value Composite
KQI — Quality
63.3
B-
Fundamental Quality Index
KVI — Value
55.0
C
Valuation Attractiveness Index
Crucible Verdict — HII

Huntington Ingalls Industries earns a solid C+ rating driven by its dominant market position in naval shipbuilding and consistent earnings execution, but diversification remains critically weak at just 45. HII trades at a modest 9% discount to fair value despite strong insider selling activity. The company's defense monopoly provides stability, though concentration risk limits upside potential in a shifting defense landscape.

— Kal, Kaladin Capital Intelligence

◆ KQI Quality Dimensions

Financial Quality
60.1
Growth Profile
65.0
Moat Durability
60.9
Management Effectiveness
68.8
Diversification & Resilience
45.0
Market Position
76.0
Weakest dimension: Diversification & Resilience (45.0)

◆ KVI Value Dimensions

DCF Margin of Safety
63.8
FCF Yield & Cash Returns
67.8
Relative Valuation
91.0
Growth-Adjusted Value
8.7
Historical Valuation
5.5
Macro Context
64.7

◆ DCF Valuation Scenarios

Bear Case
$312.50
Base Case
$438.00
Bull Case
$595.00
Price at Analysis
$400.47
ScenarioFair ValueRev CAGR (5yr)Terminal MarginWACC
🔴 Bear$312.503.0%4.5%6.2%
🟢 Base$438.005.0%5.5%5.8%
🟢 Bull$595.007.0%6.5%5.5%
Key Assumptions: HII's low beta of 0.28 yields a WACC in the 5.5-6.2% range via CAPM with a 5.5% ERP, reflecting its defense-contract stability. Revenue growth is anchored to the 5-year historical CAGR of ~7% but moderated given lumpy shipbuilding cycles; operating margins range from 4.5% (bear, reflecting recent 4.6-4.9% compression) to 6.5% (bull, reflecting potential return to 2022-level 6.8%). Capex intensity is set at ~3% of revenue consistent with recent actuals, and the anomalous low-FCF year is treated as a working capital timing issue rather than structural.

◆ Financial Snapshot

Profitability

Gross Margin12.7%
Operating Margin5.1%
Net Margin4.8%
ROIC8.1%
ROE26.4%

Balance Sheet

Balance SheetCR: 1.13
Cash ConversionFCF/EPS: 1.76x
Capital IntensityCapex/Rev: 3.2%
Altman Z-Score3.19 (Safe)
Piotroski F-Score7/9 (Good)

Growth

Revenue CAGR7.0% CAGR
Earnings CAGR2.7% CAGR
Growth ConsistencyCV: 0.53
Segment Breadth4/4 growing (100%)
Quarterly TrendRev↑
Earnings CredibilityTends to Beat

◆ Revenue Breakdown — FY2025

By Segment

Newport News Shipbuilding51.5%
Ingalls24.4%
Mission Technologies24.1%

◆ Analyst Consensus & Leadership

Analyst Price Targets

Avg Target (Last Quarter)$419.25
Analysts Covering (Quarter)4
Avg Target (Last Year)$361.75
Analysts (Year)8

Leadership & Governance

CEOPhil Sawyer · 7 years
CEO Ownership14.4%
Compensation53% performance-based
Insider ActivitySelling
Capital AllocationROIC 8.1% vs WACC 2.6%
Earnings Beat Rate82% (18/22)

◆ Company Profile

Huntington Ingalls Industries, Inc. engages in designing, building, overhauling, and repairing military ships in the United States.

CEO
Christopher Douglas Kastner
Employees
44000
Headquarters
Newport News, VA, US
IPO Date
March 22, 2011
Exchange
NYSE

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MethodologyAll ScoresCrucible BriefsPerformance@KaladinCI

Analysis conducted March 7, 2026 based on most recent SEC filings. Updated quarterly, after new SEC filings.

Point-in-time fundamental analysis. Not investment advice. Scores reflect company quality and valuation at time of analysis and may not reflect current market conditions.

© 2026 Kaladin Capital Intelligence — Conviction Through Scrutiny