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The Bull Case For Howmet Aerospace (HWM) Could Change Following Renewed Optimism From Improved U.S.-China Relations

Simply Wall St · 10/16 17:22
  • In the past week, Howmet Aerospace benefited from renewed optimism in the market after a softened stance on U.S.-China relations and continued strong operating performance drew attention from investors.
  • An interesting aspect is that widespread relief over potential trade tensions, paired with positive demand trends in aerospace markets, highlighted Howmet’s exposure to sectors signaling long-term growth potential.
  • We’ll examine how market optimism tied to improved U.S.-China relations impacts Howmet Aerospace’s investment narrative amid robust aerospace demand.

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Howmet Aerospace Investment Narrative Recap

For shareholders of Howmet Aerospace, the core investment thesis centers on sustained demand for advanced aerospace components, particularly as global air travel recovers and new aircraft deliveries accelerate. The recent reduction in U.S.-China trade tensions may improve short-term investor sentiment, but does not fundamentally alter the company’s biggest near-term catalyst: continued strength in commercial aerospace build rates. However, the key risk remains: any disruption to those rates, such as OEM supply chain constraints or production delays, could quickly impact revenue momentum. Amid this backdrop, one recent announcement stands out: Howmet’s upward revision of its 2025 revenue guidance to a range of US$8.08 billion to US$8.18 billion. This move aligns with the strong demand signals that underpin the company’s positive narrative and reinforces the importance of tracking both market optimism and actual end-market performance. In contrast to the recent optimism, investors should be aware of the ongoing vulnerability tied to concentrated exposure to major OEM customers…

Read the full narrative on Howmet Aerospace (it's free!)

Howmet Aerospace's narrative projects $10.3 billion revenue and $2.2 billion earnings by 2028. This requires 10.2% yearly revenue growth and an increase of $0.8 billion in earnings from $1.4 billion today.

Uncover how Howmet Aerospace's forecasts yield a $206.38 fair value, a 7% upside to its current price.

Exploring Other Perspectives

HWM Community Fair Values as at Oct 2025
HWM Community Fair Values as at Oct 2025

Seven individual fair value estimates from the Simply Wall St Community range from US$124.85 to US$206.38 per share. While many see upside based on solid aerospace demand, the risk of OEM production delays could affect Howmet’s ability to consistently meet higher expectations.

Explore 7 other fair value estimates on Howmet Aerospace - why the stock might be worth as much as 7% more than the current price!

Build Your Own Howmet Aerospace Narrative

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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.