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Why Huntington Ingalls Industries (HII) Is Back In The Spotlight

Simply Wall St · 1d ago

Huntington Ingalls Industries (HII) has been busy. A multibillion dollar refueling and complex overhaul contract for the USS Harry S. Truman, progress on the John F. Kennedy carrier, and a new unmanned vessels deal all sharpen the investment story.

All this contract momentum comes as Huntington Ingalls Industries’ share price tells a more cautious story. The stock is down 24.23% on a year-to-date basis, but it has still delivered a 41.61% total shareholder return over five years.

Scan beyond Huntington Ingalls Industries and review handpicked defense and infrastructure peers that also screen for contract momentum and solid fundamentals with the list of solid balance sheet and fundamentals (25 results).

Huntington Ingalls Industries now trades well below both analyst targets and some intrinsic value estimates after that 24.23% year to date slide. Is that discount compensation for real risk, or an opening price for long term buyers to study?

Most Popular Narrative: 28% Undervalued

The most followed narrative on Huntington Ingalls Industries pegs fair value at $367.25, well above the latest close at $265.02. This puts the recent share price slide against a very different valuation backdrop.

The main thing that has to go right is sustaining planned throughput gains and workforce execution so that higher Navy budgets, distributed shipbuilding, and automation investments translate into the targeted 9 to 10% shipbuilding margin profile.

The current valuation implies the share price does not fully reflect the raised 2026 shipbuilding revenue and margin guidance, the long duration contract awards for submarines and carriers, and the expanding role of autonomous systems and Mission Technologies earnings in the Huntington Ingalls Industries mix.

See why 53 investors see Huntington Ingalls Industries as 28% undervalued.

Result: Fair Value of $367.25 (UNDERVALUED)

Still, the bullish Huntington Ingalls Industries story depends on carrier execution improving and on heavily back end loaded 2026 free cash flow arriving as planned.

Find out about the key risks to this Huntington Ingalls Industries narrative.

Next Steps

Mixed on Huntington Ingalls Industries so far, or already leaning one way? Move quickly, review the numbers, and weigh both the 4 key rewards and 2 important warning signs.

Looking for more Huntington Ingalls Industries style ideas?

Do not stop with Huntington Ingalls Industries. Put that curiosity to work, compare different setups, and let the data point you toward your next potential opportunity.

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.