Latest news with #HuntingtonIngalls
Yahoo
7 days ago
- Business
- Yahoo
Q1 Rundown: Northrop Grumman (NYSE:NOC) Vs Other Defense Contractors Stocks
Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let's have a look at Northrop Grumman (NYSE:NOC) and its peers. Defense contractors typically require technical expertise and government clearance. Companies in this sector can also enjoy long-term contracts with government bodies, leading to more predictable revenues. Combined, these factors create high barriers to entry and can lead to limited competition. Lately, geopolitical tensions–whether it be Russia's invasion of Ukraine or China's aggression towards Taiwan–highlight the need for defense spending. On the other hand, demand for these products can ebb and flow with defense budgets and even who is president, as different administrations can have vastly different ideas of how to allocate federal funds. The 13 defense contractors stocks we track reported a strong Q1. As a group, revenues beat analysts' consensus estimates by 1.6% while next quarter's revenue guidance was in line. In light of this news, share prices of the companies have held steady as they are up 1.5% on average since the latest earnings results. Responsible for the development of the first stealth bomber, Northrop Grumman (NYSE:NOC) specializes in providing aerospace, defense, and security solutions for various industry applications. Northrop Grumman reported revenues of $9.47 billion, down 6.6% year on year. This print fell short of analysts' expectations by 4.7%. Overall, it was a disappointing quarter for the company with full-year EPS guidance missing analysts' expectations. Northrop Grumman delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The stock is down 9.9% since reporting and currently trades at $478.25. Read our full report on Northrop Grumman here, it's free. Formed through the split of IT services company SAIC, Leidos (NYSE:LDOS) offers technology and engineering solutions such as military training systems for the defense, civil, and health markets. Leidos reported revenues of $4.25 billion, up 6.8% year on year, outperforming analysts' expectations by 3.6%. The business had a very strong quarter with an impressive beat of analysts' backlog and EBITDA estimates. However, the results were likely priced into the stock as it's traded sideways since reporting. Shares currently sit at $147.50. Is now the time to buy Leidos? Access our full analysis of the earnings results here, it's free. Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE:HII) develops marine vessels and their mission systems and maintenance services. Huntington Ingalls reported revenues of $2.73 billion, down 2.5% year on year, falling short of analysts' expectations by 2.1%. It was a mixed quarter as it posted an impressive beat of analysts' EPS estimates but a significant miss of analysts' adjusted operating income estimates. As expected, the stock is down 2.8% since the results and currently trades at $223.51. Read our full analysis of Huntington Ingalls's results here. Known for projects like the construction of Guantanamo Bay, KBR provides professional services and technologies, specializing in engineering, construction, and government services sectors. KBR reported revenues of $2.06 billion, up 13% year on year. This print lagged analysts' expectations by 1.4%. In spite of that, it was a strong quarter as it produced a solid beat of analysts' EBITDA estimates. The stock is up 1.2% since reporting and currently trades at $52.18. Read our full, actionable report on KBR here, it's free. Developing submarine detection systems for the U.S. Navy, Leonardo DRS (NASDAQ:DRS) is a provider of defense systems, electronics, and military support services. Leonardo DRS reported revenues of $799 million, up 16.1% year on year. This result surpassed analysts' expectations by 9.2%. Overall, it was a very strong quarter as it also produced a solid beat of analysts' adjusted operating income estimates and an impressive beat of analysts' EPS estimates. Leonardo DRS scored the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is up 12.8% since reporting and currently trades at $41.68. Read our full, actionable report on Leonardo DRS here, it's free. Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape. Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Sign in to access your portfolio
Yahoo
7 days ago
- Business
- Yahoo
1 Industrials Stock with Solid Fundamentals and 2 to Be Wary Of
Whether you see them or not, industrials businesses play a crucial part in our daily activities. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the market seems to be baking in a prolonged downturn as the industry has shed 11.8% over the past six months. This drop was worse than the S&P 500's 2.2% fall. Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. With that said, here is one industrials stock boasting a durable advantage and two we're steering clear of. Market Cap: $8.78 billion Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE:HII) develops marine vessels and their mission systems and maintenance services. Why Do We Steer Clear of HII? Backlog growth averaged a weak 1.8% over the past two years, suggesting it may need to tweak its product roadmap or go-to-market strategy Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 9.2 percentage points Diminishing returns on capital suggest its earlier profit pools are drying up At $223.51 per share, Huntington Ingalls trades at 15.8x forward P/E. If you're considering HII for your portfolio, see our FREE research report to learn more. Market Cap: $40.64 billion Established to make automobiles accessible to a broader segment of the population, Ford (NYSE:F) designs, manufactures, and sells a variety of automobiles, trucks, and electric vehicles. Why Should You Sell F? Flat vehicles sold over the past two years imply it may need to invest in improvements to get back on track Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 13.4 percentage points 8× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings Ford is trading at $10.22 per share, or 7.5x forward P/E. To fully understand why you should be careful with F, check out our full research report (it's free). Market Cap: $698.9 million Spun off from FTAI Aviation in 2021, FTAI Infrastructure (NASDAQ:FIP) invests in and operates infrastructure and related assets across the transportation and energy sectors. Why Do We Like FIP? Annual revenue growth of 33.3% over the past three years was outstanding, reflecting market share gains this cycle Market share is on track to rise over the next 12 months as its 78.2% projected revenue growth implies demand will accelerate from its two-year trend FTAI Infrastructure's stock price of $6.08 implies a valuation ratio of 2.6x forward EV-to-EBITDA. Is now the time to initiate a position? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
27-05-2025
- Business
- Yahoo
Reasons to Include Huntington Ingalls Stock in Your Portfolio
Huntington Ingalls Industries HII, with rising earnings estimates, robust ROE, better debt management, a solid backlog and shareholder-friendly initiatives, offers a great investment opportunity in the Zacks Aerospace Defense focus on the reasons that make this Zacks Rank #2 (Buy) stock an attractive investment pick at the moment. The Zacks Consensus Estimate for HII's 2025 earnings per share (EPS) has increased 3.3% to $14.31 per share over the past 30 Zacks Consensus Estimate for HII's total revenues for 2025 stands at $11.91 billion, indicating year-over-year growth of 3.3%.The company's (three to five years) earnings growth rate is pegged at 11%. HII surpassed expectations in the last four reported quarters and delivered an average earnings surprise of 4.20% in the last four quarters. Return on equity (ROE) measures how effectively a company has used its funds to generate higher returns. HII currently has an ROE of 12.26% compared to the industry's average of 10.75%. This suggests that the company has been utilizing its funds more effectively than its peers in the industry. Huntington Ingalls has been increasing shareholders' value through dividend payments. Currently, the company's quarterly dividend is $1.35 per share, resulting in an annualized dividend of $5.40. During the first quarter of 2025, the company paid dividends worth $53 million. The company's current dividend yield is 2.40%, better than the Zacks S&P 500 Composite's average of 1.27%. With the strong demand that Huntington Ingalls products enjoy, the company's order growth remains solid. The value of the company's new contract awards won in the first quarter of 2025 was nearly $2.1 billion. This resulted in a total backlog of $48.05 billion as of March 31, 2025. Such a significant backlog count bodes well for the company's revenue generation prospects in the coming years. Currently, Huntington Ingalls' total debt to capital is 40.15%, better than the industry's average of 52.09%.HII's times interest earned ratio (TIE) at the end of the first quarter of 2025 was 7.3. The TIE ratio of more than 1 indicates that the company will be able to meet its interest payment obligations in the near term without any problems. In the past three months, HII shares have risen 28% compared with the industry's growth of 8%. Image Source: Zacks Investment Research A few other top-ranked stocks from the same industry are Howmet Aerospace Inc. HWM, which sports a Zacks Rank #1 (Strong Buy), and Airbus SE EADSY and GE Aerospace GE, each carrying a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank stocks long-term earnings growth rate is 19%. The Zacks Consensus Estimate for Howmet's 2025 sales is pegged at $8.06 billion, which implies an improvement of 8.5%.EADSY's long-term earnings growth rate is 4%. The Zacks Consensus Estimate for Airbus' total revenues for 2025 stands at $82.57 billion, which indicates growth of 10.4%.GE's long-term earnings growth rate is 15.1%. The company delivered an average earnings surprise of 17.97% in the last four quarters. 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 GE Aerospace (GE) : Free Stock Analysis Report Huntington Ingalls Industries, Inc. (HII) : Free Stock Analysis Report Airbus Group (EADSY) : Free Stock Analysis Report Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-05-2025
- Business
- Yahoo
4 Reasons to Buy Huntington Ingalls Industries Stock Like There's No Tomorrow
Shares of Huntington Ingalls Industries have rallied at the start of 2025 as the Trump administration aims to revitalize U.S. military shipbuilding funding. The company expects to receive more than $50 billion in new contract awards over the next 20 months, adding to its extensive order backlog. The stock is well positioned for further gains, supported by solid fundamentals. 10 stocks we like better than Huntington Ingalls Industries › Huntington Ingalls Industries (NYSE: HII) has emerged as a stock market outperformer in 2025, rewarding shareholders with a solid 21% return year to date as of this writing. The defense contractor, recognized as the largest military shipbuilder in the United States, is set to capitalize on several growth tailwinds. The new Trump administration has proposed increased funding for domestic shipbuilding programs, which directly benefits the company's unique market positioning. The company's outlook is further bolstered by an extensive order backlog set to drive increasing earnings. Here are four reasons I believe shares of Huntington Ingalls are a great buy for your portfolio now. U.S. Navy aircraft carriers and nuclear-powered submarines are modern engineering marvels of unparalleled complexity, with Huntington Ingalls Industries leading innovation in the field. The company's Newport News Shipyard is the only U.S. facility capable of constructing Gerald R. Ford-class aircraft carriers, among the most technologically advanced warships globally. Huntington Ingalls' shipbuilding division also constructs Arleigh Burke-class destroyers and San Antonio-class amphibious ships, essential for surface combat and troop deployment. Additionally, the company's Mission Technologies division develops uncrewed undersea vehicles (SUUV) like the Lionfish, alongside cybersecurity solutions and AI-driven autonomous systems, highlighting its diverse defense offerings. This critical role in producing key defense assets positions Huntington Ingalls as an indispensable partner to the U.S. Department of Defense, enhancing its appeal as a potential investment. A major theme in the new Trump administration has been revitalizing U.S. military strength to counter China's advancements in high-tech systems like hypersonic missiles and AI-enhanced naval technologies. President Trump outlined plans to boost shipbuilding for national security and economic growth during a joint address to Congress in February. This was followed by an Executive Order in April titled "Restoring America's Maritime Dominance" aimed at strengthening domestic shipbuilding capabilities, enhancing maritime workforce training, and ensuring adequate commercial vessel capacity for national security. Huntington Ingalls Industries should benefit from these policy directives. With a current $48 billion order backlog, Huntington Ingalls Industries now expects more than $50 billion in additional awards in the next 20 months, adding to its growth runway and earnings potential. In the first quarter (for the period ended March 31), Huntington Ingalls reported revenue of $2.7 billion, representing a decline of 2.5% year over year, reflecting the uneven timing of large orders. Nevertheless, earnings per share (EPS) of $3.97 surpassed Wall Street estimates, driven by higher margins. Looking ahead, the company is guiding for full-year shipbuilding revenue between $8.9 billion and $9.1 billion, at the midpoint, implying an increase of 3% from 2024, with several milestone ship deliveries planned through 2026. Perhaps the biggest development for Huntington Ingalls is its recent acquisition of a new production site near Charleston, South Carolina. The facility is expected to enhance overall capacity by 20% from 2024 company levels, setting the stage for stronger top-line growth into the next decade. According to Wall Street analysts, from the current 2025 EPS estimate of $13.92, roughly flat from last year, the 2026 forecast of $16.21 points to a 16.5% increase next year. That's great news for investors eyeing the sustainability of the company's $1.35 per share quarterly dividend, yielding 2.31%. Huntington Ingalls has increased its annual dividend payment for the past 13 years, with room for more growth going forward. Where Huntington Ingalls Industries stands out is through its attractive valuation, trading at 16 times its consensus 2025 EPS as a forward price-to-earnings (P/E) ratio. This level represents a discount to defense sector peers, including companies like RTX, Lockheed Martin, General Dynamics, and Northrop Grumman, which, as a group, trade at an average forward P/E closer to 19. With a renewed strategic focus on military seapower and naval technologies, Huntington Ingalls' stock may be undervalued. I'm bullish on Huntington Ingalls Industries and believe all the pieces are in place for its share price rally to keep going. The stock is a great option for investors to add to diversified portfolios and gain exposure to high-level themes in domestic manufacturing and the defense sector. Before you buy stock in Huntington Ingalls Industries, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Huntington Ingalls Industries wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $635,275!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $826,385!* Now, it's worth noting Stock Advisor's total average return is 967% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 Dan Victor has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin and RTX. The Motley Fool has a disclosure policy. 4 Reasons to Buy Huntington Ingalls Industries Stock Like There's No Tomorrow was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
15-05-2025
- Business
- Yahoo
HII Q1 Earnings Call: Profit Beats Offset Revenue Miss as Shipbuilding Initiatives Progress
Aerospace and defense company Huntington Ingalls (NYSE:HII) fell short of the market's revenue expectations in Q1 CY2025, with sales falling 2.5% year on year to $2.73 billion. Its non-GAAP profit of $3.31 per share was 17.8% above analysts' consensus estimates. Is now the time to buy HII? Find out in our full research report (it's free). Revenue: $2.73 billion vs analyst estimates of $2.79 billion (2.5% year-on-year decline, 2.1% miss) Adjusted EPS: $3.31 vs analyst estimates of $2.81 (17.8% beat) Adjusted EBITDA: $237.5 million vs analyst estimates of $210 million (8.7% margin, 13.1% beat) Operating Margin: 5.9%, in line with the same quarter last year Free Cash Flow was -$462 million compared to -$274 million in the same quarter last year Backlog: $48.05 billion at quarter end, in line with the same quarter last year Market Capitalization: $8.75 billion Huntington Ingalls' first quarter results were shaped by operational challenges in shipbuilding, with management highlighting production delays at Newport News due to late equipment deliveries and weather disruptions. CEO Chris Kastner acknowledged that while Ingalls Shipbuilding met its production goals, Newport News experienced setbacks, particularly on the CVN 80 carrier. The company also noted lower volumes in amphibious assault ships and nuclear support services as contributing factors to the revenue decline. Kastner stated, 'Once this equipment is received from our suppliers, which is scheduled throughout the summer, we anticipate an acceleration of progress.' Looking ahead, management maintained its full-year outlook and pointed to ongoing cost reduction efforts and increased outsourcing as key levers for future improvement. CFO Tom Stiehle noted that the company is 'progressing on each of these items,' expecting margin and free cash flow normalization in the coming years. Leadership also cited industry tailwinds, including new government contracts and executive orders aimed at strengthening the domestic shipbuilding base, as supportive of long-term growth. Management attributed the quarter's performance to specific operational issues and strategic moves within its core shipbuilding and Mission Technologies divisions. Production Delays at Newport News: Delays in receiving major equipment impacted progress on the CVN 80 carrier, with weather compounding the schedule variance. Management expects improvement once the necessary parts arrive during the summer. Shipbuilding Throughput Initiatives: Huntington Ingalls continued efforts to increase shipbuilding throughput by 20% year over year, including ramped-up outsourcing and the integration of its South Carolina facility. Ingalls Shipbuilding operations remained on track, while Newport News lagged due to the aforementioned equipment delays. Cost Reduction Plan: The company reaffirmed its goal of achieving $250 million in annualized cost reductions by year-end. Initiatives include contract negotiations, workforce development, and streamlining operational processes across shipyards. Mission Technologies Growth: The Mission Technologies division reported contract wins, such as a high-energy laser prototype for the U.S. Army and delivery of uncrewed undersea vehicles, signaling continued traction in advanced defense technologies. Strategic Partnerships and Policy Tailwinds: Huntington Ingalls established a memorandum of understanding with HD Hyundai Heavy Industries to explore collaborative shipbuilding opportunities. Management highlighted executive orders from the administration as supportive of domestic shipbuilding and defense innovation. Management's outlook centers on ramping up shipbuilding throughput, delivering on cost reductions, and capitalizing on policy-driven demand in the U.S. maritime sector. Operational Execution Needed: Achieving targeted increases in shipbuilding throughput and meeting delivery schedules, especially at Newport News, are critical for revenue and margin improvement. Defense Policy and Funding: The company expects sustained demand from new government contracts, industry initiatives, and executive orders aimed at expanding shipbuilding capacity and modernizing the defense industrial base. Labor and Supply Chain Dynamics: Management cited workforce retention, targeted hiring of experienced personnel, and timely receipt of key equipment as ongoing risks to schedules and cost efficiency. Doug Harned (Bernstein): Asked how increased government funding would translate into higher submarine production rates. CEO Chris Kastner pointed to targeted investments in workforce and facilities, noting, 'These are the right investments to get at the build rate.' David Strauss (Barclays): Inquired about the structure of new shipbuilding contracts and implications for margins. CFO Tom Stiehle explained the new contracts blend cost-type and incentive structures, aiming for a balance between affordability and profitability. Scott Mikus (Melius Research): Questioned whether more contracts would shift to cost-plus formats amid labor negotiations. Kastner responded that contract types would be determined case-by-case, emphasizing the importance of timely wage support for workforce retention. Myles Walton (Wolfe Research): Probed progress on hiring and attrition. Kastner reported 1,000 new hires in the quarter and noted attrition is 'moving in the right direction,' driven by hiring more experienced personnel. Ron Epstein (Bank of America): Asked about modernization and automation in shipyards. Kastner stated that while some automation is underway, the focus is on streamlining processes and increasing efficiency, rather than full-scale automation. In the coming quarters, the StockStory team will monitor (1) progress on shipbuilding throughput and timely resolution of supply chain and equipment delays, (2) execution of cost reduction and outsourcing initiatives to improve margins, and (3) the impact of new government contracts and policy measures on backlog and order flow. Additionally, the pace of workforce hiring and retention, as well as progress on Mission Technologies' advanced defense programs, will be important signposts for operational and financial performance. Huntington Ingalls currently trades at a forward P/E ratio of 15.8×. Is the company at an inflection point that warrants a buy or sell? Find out in our free research report. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
