Howmet Aerospace Inc. HWM

Name: HWM Crucible Score
Creator: Kaladin Capital Intelligence

IndustrialsIndustrial - MachineryNYSE📅 Scored March 7, 2026

Price at analysis: $236.33

Crucible Score

53.0

Quality × Value Composite

KQI — Quality

73.3

B+

Fundamental Quality Index

KVI — Value

28.2

Valuation Attractiveness Index

Crucible Verdict — HWM

Howmet Aerospace Inc. presents a stark quality-value divide, with solid operational metrics (73.3 KQI) undermined by poor valuation appeal (28.2 KVI) at current levels above fair value. HWM trades at a 10% premium despite strong fundamentals including 97% earnings beat rates and performance-driven leadership under Ortberg. The aerospace supplier needs meaningful price compression to justify entry given stretched multiples.

— Kal, Kaladin Capital Intelligence

◆ KQI Quality Dimensions

Financial Quality

77.1

Growth Profile

73.0

Moat Durability

65.5

Management Effectiveness

82.2

Diversification & Resilience⚠

54.0

Market Position

76.0

Weakest dimension: Diversification & Resilience (54.0)

◆ KVI Value Dimensions

DCF Margin of Safety

34.9

FCF Yield & Cash Returns

25.8

Relative Valuation

5.0

Growth-Adjusted Value

59.9

Historical Valuation

5.5

Macro Context

23.6

◆ DCF Valuation Scenarios

Bear Case

$131.52

Base Case

$213.78

Bull Case

$330.15

Price at Analysis

$236.33

Scenario	Fair Value	Rev CAGR (5yr)	Terminal Margin	WACC
🔴 Bear	$131.52	6.0%	24.0%	11.1%
🟢 Base	$213.78	9.0%	27.0%	10.5%
🟢 Bull	$330.15	12.0%	30.0%	9.9%

Key Assumptions: HWM has demonstrated strong revenue growth (~13.5% CAGR over 5 years) and significant margin expansion (operating margin from 17.4% to 25.8%). Base case assumes growth moderates to ~9% as aerospace cycle matures while margins stabilize near current levels. WACC calculated using CAPM with 5.55% ERP (mid-range for industrials), yielding 10.49% base WACC; bear/bull cases adjust ERP by +/-50bps. D&A-to-revenue trending ~3.4%, capex intensity ~5.5% of revenue reflecting continued investment in capacity.

◆ Financial Snapshot

Profitability

Gross Margin30.7%

Operating Margin25.8%

Net Margin18.3%

ROIC17.7%

ROE10.1%

Balance Sheet

Balance SheetCR: 2.13

Cash ConversionFCF/EPS: 0.80x

Capital IntensityCapex/Rev: 5.5%

Altman Z-Score12.82 (Safe)

Piotroski F-Score8/9 (Strong)

Growth

Revenue CAGR13.5% CAGR

Earnings CAGR55.5% CAGR

Growth ConsistencyCV: 13.62

Segment Breadth5/5 growing (100%)

Quarterly TrendRev↑, Margin↑

Earnings CredibilityConsistent Beater

◆ Revenue Breakdown — FY2025

By Segment

Engine Products Segment71.2%

Fastening Systems28.8%

By Geography

UNITED STATES60.6%

FRANCE8.6%

JAPAN7.1%

GERMANY6.1%

UNITED KINGDOM5.2%

ITALY3.7%

CANADA2.6%

MEXICO2.3%

POLAND2.1%

CHINA1.8%

Total Revenue

$7.2B

Fiscal Year 2025

◆ Analyst Consensus & Leadership

Analyst Price Targets

Avg Target (Last Quarter)$270.08

Analysts Covering (Quarter)12

Avg Target (Last Year)$245.00

Analysts (Year)21

Leadership & Governance

CEOKelly Ortberg · 5 years

CEO Ownership29.6%

Compensation91% performance-based

Insider ActivitySelling

Capital AllocationROIC 17.7% vs WACC 3.9%

Earnings Beat Rate97% (21/22)

◆ Company Profile

Howmet Aerospace Inc. provides advanced engineered solutions for the aerospace and transportation industries in the United States, Japan, France, Germany, the United Kingdom, Mexico, Italy, Canada, Poland, China, and internationally.

CEO

John C. Plant

Employees

23930

Headquarters

Pittsburgh, PA, US

IPO Date

November 1, 2016

Exchange

NYSE

Website

howmet.com

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Methodology All Scores Crucible Briefs Performance @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.