Is Howmet Aerospace (HWM) Expensive Following Raised 2026 Guidance?

Howmet Aerospace stock reacts to raised 2026 guidance

Howmet Aerospace (HWM) lifted its full year 2026 revenue outlook to a range of about US$10.0b to US$10.1b after reporting second quarter results that exceeded earlier revenue expectations.

The company also issued new guidance for third quarter 2026 revenue of US$2,565 million to US$2,585 million and highlighted demand in commercial and defense aerospace as well as industrial gas turbines.

See our latest analysis for Howmet Aerospace.

At a share price of US$281.63, Howmet Aerospace has recorded a 33.03% year to date share price return. The 1 year total shareholder return of 59.62% points to strong momentum that has coincided with raised guidance, solid recent quarterly results and an ongoing buyback program.

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Howmet Aerospace now combines strong recent execution, higher guidance and a powerful share price run. The real test for investors is whether the current valuation still leaves enough room for an attractive risk and reward trade off.

Most Popular Narrative: 13.6% Undervalued

On the most followed narrative, Howmet Aerospace’s fair value of $325.93 sits above the recent $281.63 close, which puts the raised 2026 guidance into a richer context for investors weighing today’s price against longer term expectations.

Major capacity expansions in high margin engine products and industrial gas turbines, backed by customer agreements, are set to ramp in 2026 and 2027. These projects should deliver significant revenue growth and incremental margin expansion as initial launch costs normalize.

Read the complete narrative.

Want to see why this fair value sits comfortably above the current share price? The core of the narrative leans on faster compounding earnings, rising margins and a valuation multiple that assumes Howmet Aerospace keeps earning a premium over the wider aerospace and defense group. Curious which specific revenue path and profitability mix underpin those assumptions.

Result: Fair Value of $325.93 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, investors in Howmet Aerospace still need to watch for softer commercial aerospace demand or contract changes with major OEM customers, as these could pressure margins and cash generation.

Find out about the key risks to this Howmet Aerospace narrative.

Another View on Howmet Aerospace’s Valuation

The first narrative on Howmet Aerospace focuses on fair value and analyst targets. A simple P/E check tells a different story. HWM trades on a P/E of 60.1x, compared with a fair ratio of 36.5x, a US Aerospace & Defense average of 39x, and a peer average of 25x. That gap suggests investors are paying a steep premium that could either compress or hold if earnings continue to meet high expectations.

If you want to see how this richer multiple compares with detailed valuation work and potential market scenarios, it is worth reviewing the See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

With sentiment clearly mixed on Howmet Aerospace, with both risks and rewards in play, it makes sense to review the detail for yourself and move quickly to shape your own view by checking the 2 key rewards and 1 important warning sign

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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.

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