Howmet Aerospace Inc. HWM
Hold on HWM — the fundamental engine is firing on all cylinders but the valuation premium remains extreme even after a recent pullback to $263.29 from ~$282. FY2025 revenue grew 11.1% to $8.25B with operating margin expanding to 25.8% and FCF of $1.43B, while debt fell to $3.05B from $4.35B in 2021 — a clear operational success story.
Yet at 56.4x PE, 11.6x PS, and 39.7x EV/EBITDA, HWM trades 86–221% above peer medians, and insiders have net sold $179.7M over 24 months, signaling that even management is harvesting gains at these levels.
What could go wrong
- Valuation compression. At 56.4x PE versus a peer median of 30.4x, any deceleration in revenue growth or margin expansion could trigger a sharp de-rating; the stock already sits below its 50-day MA at $278.14 with bearish MACD.
- Insider selling persistence. Net insider dispositions of 715,273 shares worth $179.7M over 24 months, with recent open-market sales by the EVP/CAO at $251.70, suggest insiders view the stock as fully valued.
- Aerospace cycle risk. HWM's growth depends on sustained commercial aerospace and IGT demand; any disruption to aircraft production ramps or OEM destocking would hit revenue and margins simultaneously.
- Smart money ambivalence. Smart money score of 0.1134 as of Q2 2026 is modest and well below the 0.1412 peak in mid-2025, indicating institutional conviction is lukewarm despite strong fundamentals.
What would change my mind
Where this comes from: FMP fundamentals FY2025 + derived_metrics · FMP fundamentals FY2025 vs FY2021 · peer_relative as of latest data · insider summary (24-month window). Orin's read on HWM; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All HWM filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Brasada Capital Management | $8.5B | 1.5% of fund |
| Vanguard Capital Management | $7.0B | 0.2% of fund |
| State Street | $5.1B | 0.2% of fund |
| Vanguard Portfolio Management | $5.0B | 0.2% of fund |
| Jpmorgan Chase & | $5.0B | 0.3% of fund |
| Fmr | $4.1B | 0.2% of fund |
123 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 52 Form 4 filings, net −$179.7M. Of the 50 on hand, 0 were open-market purchases and 7 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about HWM
Orin answers questions about HWM from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 49.0× | 38.6× | 44.5× |
| EV/EBITDA | 34.7× | 20.3× | — |
| P/S | 10.04× | 3.36× | — |
| P/B | 16.0× | 5.5× | — |
Its P/E sits 60th percentile of its own last 5 years (+0.68σ from its own mean).
23.6%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $1.4B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$331
$290 – $370 · +45% against today's price
- 21 buy or overweight
- 3 hold
- 1 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| HWMHowmet Aerospace Inc. | $92B | 49.0× | 34.7× | 34.4% | 20.5% | 34% |
| CMICummins Inc. | $72B | 26.7× | 15.6× | 25.3% | 7.8% | 22% |
| EMREmerson Electric Co. | $87B | 33.7× | 19.1× | 53.2% | 13.8% | 13% |
| ITWIllinois Tool Works Inc. | $79B | 24.7× | 18.9× | 44.2% | 19.4% | 102% |
| JCIJohnson Controls International plc | $88B | 25.3× | 27.0× | 36.7% | 14.3% | 27% |
| MMM3M Company | $88B | 30.1× | 17.9× | 39.4% | 11.9% | 77% |
| NOCNorthrop Grumman Corporation | $73B | 16.3× | 11.7× | 20.1% | 10.5% | 27% |
| PHParker-Hannifin Corporation | $122B | 33.6× | 22.5× | 37.7% | 17.0% | 25% |
| TDGTransDigm Group Incorporated | $62B | 33.5× | 18.6× | 59.6% | 21.3% | -21% |
| UPSUnited Parcel Service, Inc. | $81B | 17.8× | 9.9× | 16.6% | 5.1% | 29% |
| WMWaste Management, Inc. | $83B | 29.3× | 14.1× | 35.0% | 11.1% | 29% |
The median is of the 10 peers listed above and nothing else — check it against the column. This company trades 74.9% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $116 | $251.76 · −54% | 2026-06-10 |
| Levered DCF | $122 | $251.76 · −52% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.