Howmet's Q4 Earnings & Revenues Surpass Estimates, Increase Y/Y

Howmet Aerospace Inc.’s HWM fourth-quarter 2025 adjusted earnings of $1.05 per share beat the Zacks Consensus Estimate of 97 cents. The bottom line surged 42% year over year.

Total revenues of $2.17 billion beat the consensus estimate of $2.14 billion. The top line increased 3.8% from the year-ago quarter. The increase was backed by strength in the company’s commercial aerospace market.

Howmet’s Segmental Details

The Engine Products segment’s revenues totaled $1.16 billion, representing 53.5% of net revenues. On a year-over-year basis, the segment’s revenues increased 20%, driven by growth in the commercial aerospace, defense aerospace and industrial gas turbine markets. The Zacks Consensus Estimate for Engine Products’ revenues was pegged at $1.13 billion.

The Fastening Systems segment generated revenues of $454 million, accounting for 20.7% of net revenues. Revenues increased 13% year over year, driven by growth in the commercial aerospace market, partially offset by softness in the commercial transportation market. The consensus estimate for Fastening Systems’ revenues was pegged at $463 million.

The Engineered Structures segment’s revenues, representing 13.4% of net revenues, increased 4% year over year to $287 million. The results benefited from growth in the defense aerospace market. The Zacks Consensus Estimate for Engineered Structures’ revenues was pegged at $310 million.

The Forged Wheels segment’s revenues totaled $264 million, representing 12% of net revenues. On a year-over-year basis, the segment’s revenues were up 9%, driven by higher aluminum cost pass-through. This was offset by 10% lower volumes in the commercial transportation market. The consensus estimate for Forged Wheels’ revenues was pegged at $226 million.

Howmet Aerospace Inc. Price, Consensus and EPS Surprise

Howmet Aerospace Inc. price-consensus-eps-surprise-chart | Howmet Aerospace Inc. Quote

HWM’s Margin Profile

Howmet’s cost of goods sold rose 3.4% year over year to $1.41 billion. Selling, general, administrative and other expenses decreased 4% year over year to $96 million. Research and development expenses were $10 million.

Adjusted EBITDA, excluding special items, was $653 million, up 29% year over year. Adjusted EBITDA margin increased 330 basis points year over year to 30.1%. Adjusted operating income increased 34% year over year to $580 million.

The adjusted operating income margin was 26.8%, up 380 basis points year over year. Net interest expenses totaled $37 million, down 7.5% from the year-ago quarter.

Howmet’s Balance Sheet and Cash Flow

Exiting the fourth quarter, Howmet had cash and cash equivalents of $742 million compared with $564 million at the end of December 2024. Long-term debt was $2.86 billion compared with $3.31 billion at the end of fourth-quarter 2024.

In 2025, Howmet generated net cash of $1.88 billion from operating activities compared with $1.30 billion in the year-ago period. Capital expenditures totaled $453 million compared with $321 million a year ago. Free cash flow in the same period was $1.43 billion.

Howmet paid out dividends of $181 million in 2025 compared with $109 million in the year-ago period. In the same period, it repurchased shares worth $700 million.

HWM’s Q1 Outlook

For the first quarter of 2026, Howmet expects revenues to be in the range of $2.225-$2.245 billion. Adjusted EBITDA is expected to be between $680 million and $690 million, while the adjusted EBITDA margin is anticipated to be in the range of 30.6-30.7%. Adjusted earnings per share (EPS) are estimated to be in the range of $1.09-$1.11.

Howmet’s 2026 Outlook

Howmet predicts revenues to be in the range of $9.00-$9.20 billion. Adjusted EBITDA is expected to be between $2.71 billion and $2.81 billion, while the adjusted EBITDA margin is projected to be 30.1-30.5%.

Adjusted EPS is forecasted to be in the band of $4.35-$4.55. Free cash flow is expected to be in the range of $1.55-$1.65 billion.

HWM’s Zacks Rank & Stocks to Consider

The company currently carries a Zacks Rank #3 (Hold). 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks from the same space are discussed below:

GE Aerospace GE currently sports a Zacks Rank of 1. GE Aerospace’s earnings topped the consensus estimate thrice and missed once in the trailing four quarters. The average earnings surprise was 14.3%. In the past 60 days, the Zacks Consensus Estimate for GE Aerospace’s 2026 earnings has increased 6%.

RBC Bearings Incorporated RBC presently sports a Zacks Rank of 1. RBC Bearings’ earnings surpassed the consensus estimate in each of the trailing four quarters. The average earnings surprise was 5.3%. In the past 60 days, the Zacks Consensus Estimate for RBC Bearings’ fiscal 2026 earnings has increased 3.9%.

Parker-Hannifin Corporation PH currently carries a Zacks Rank #2 (Buy). Parker-Hannifin’s earnings topped the consensus estimate in each of the trailing four quarters. The average earnings surprise was 6.8%. In the past 60 days, the Zacks Consensus Estimate for Parker-Hannifin’s fiscal 2026 earnings has increased 2.1%.

5 Stocks Set to Double

Each was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They include

Stock #1: A Disruptive Force with Notable Growth and Resilience

Stock #2: Bullish Signs Signaling to Buy the Dip

Stock #3: One of the Most Compelling Investments in the Market

Stock #4: Leader In a Red-Hot Industry Poised for Growth

Stock #5: Modern Omni-Channel Platform Coiled to Spring

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

Source Zacks-com