Investors in Howmet Aerospace Inc. (NYSE:HWM) had a good week, as its shares rose 6.9% to close at US$63.27 following the release of its yearly results. Howmet Aerospace reported US$6.6b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.83 beat expectations, being 5.3% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Howmet Aerospace from 17 analysts is for revenues of US$7.12b in 2024. If met, it would imply an okay 7.3% increase on its revenue over the past 12 months. Per-share earnings are expected to climb 19% to US$2.22. Before this earnings report, the analysts had been forecasting revenues of US$7.03b and earnings per share (EPS) of US$2.17 in 2024. So the consensus seems to have become somewhat more optimistic on Howmet Aerospace's earnings potential following these results.
There's been no major changes to the consensus price target of US$64.42, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Howmet Aerospace, with the most bullish analyst valuing it at US$74.00 and the most bearish at US$53.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Howmet Aerospace's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Howmet Aerospace is forecast to grow faster in the future than it has in the past, with revenues expected to display 7.3% annualised growth until the end of 2024. If achieved, this would be a much better result than the 11% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 6.5% per year. So it looks like Howmet Aerospace is expected to grow at about the same rate as the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Howmet Aerospace's earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Howmet Aerospace going out to 2026, and you can see them free on our platform here..
You still need to take note of risks, for example - Howmet Aerospace has 1 warning sign we think you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.