NEWPORT NEWS, Va. - Huntington Ingalls Industries (NYSE:HII), the largest military shipbuilder in the United States, announced a leadership transition at its Newport News Shipbuilding division. Kari Wilkinson will take over as president of the division starting January 1, 2025, succeeding Jennifer Boykin, who is retiring after 37 years with the company. This move was confirmed by HII's Board of Directors today.
Wilkinson, who has been leading HII's Ingalls Shipbuilding division since 2021, will become the 21st president of Newport News Shipbuilding. She is recognized for her role in securing significant contracts for the company, including a $9.6 billion deal for three San Antonio-class amphibious ships and a contract modification for an America-class large-deck amphibious ship.
Jennifer Boykin will retire at the end of the year but will remain in an advisory role until March to ensure a smooth transition. During her tenure, Boykin is credited with leading the division through the COVID-19 pandemic, advancing digital ship construction, and securing major contracts for aircraft carriers and submarines.
Brian Blanchette, who has been with Ingalls since 1996 and most recently held the role of vice president of quality and engineering, has been elected to succeed Wilkinson as executive vice president of HII and president of Ingalls Shipbuilding. Blanchette expressed his commitment to continuing the legacy of quality shipbuilding and supporting the nation's service members.
The leadership changes come as HII continues to play a crucial role in national security, with a workforce of 44,000 and a history of over 135 years. The company's broad capabilities include shipbuilding, unmanned systems, cyber, ISR, AI/ML, and synthetic training.
This announcement is based on a press release statement from Huntington Ingalls Industries.
In other recent news, Huntington Ingalls Industries (HII) reported a decrease in third-quarter earnings for 2024, with earnings per share dropping to $2.56 from $3.70 in the same quarter of the previous year. Additionally, HII's revenue saw a 2.4% year-on-year decline to $2.7 billion. Notwithstanding these setbacks, the company announced a significant $9.6 billion contract award for amphibious warships, increasing its backlog to $49.4 billion.
TD Cowen downgraded HII from Buy to Hold, citing persistent shipbuilding execution challenges that are expected to continue impacting the company's margin levels. The firm also significantly reduced the price target for HII to $180 from the previous $290.
In response to operational challenges, HII revised its full-year guidance for shipbuilding revenue to $8.8 billion and updated its free cash flow expectations to range between zero and $100 million. The company is focusing on workforce training and supply chain improvements to address these performance challenges.
In other recent developments, HII anticipates submarine contract agreements in late 2024, aiming for mid to long-term shipbuilding margins of 9-10%. The company also plans to consolidate Mission Technologies to enhance competitiveness and reduce costs. Despite a year-over-year decline in third-quarter revenues and EPS, HII remains confident in its future growth, driven by strategic investments in workforce and infrastructure.
InvestingPro Insights
As Huntington Ingalls Industries (NYSE:HII) navigates this significant leadership transition, investors may find valuable context in the company's current financial metrics and market performance. According to InvestingPro data, HII's market capitalization stands at $7.56 billion, reflecting its substantial presence in the defense industry.
The company's P/E ratio of 10.81 suggests that it may be undervalued compared to its peers, which aligns with an InvestingPro Tip indicating that HII is trading at a low P/E ratio relative to its near-term earnings growth. This could be particularly relevant as the company undergoes leadership changes that may impact future performance.
Despite the positive outlook on valuation, it's worth noting that HII's stock has faced recent challenges. An InvestingPro Tip highlights that the stock has taken a significant hit over the last week, with a 1-week price total return of -22.86%. This short-term volatility may present both risks and opportunities for investors as the new leadership team takes the helm.
On a positive note, HII has demonstrated a commitment to shareholder returns, with an InvestingPro Tip revealing that the company has raised its dividend for 13 consecutive years. The current dividend yield stands at 2.79%, which may be attractive to income-focused investors during this transition period.
For those considering a deeper analysis of HII's prospects, InvestingPro offers 12 additional tips that could provide further insights into the company's financial health and market position. These additional tips could be particularly valuable in assessing the potential impact of the leadership changes on HII's long-term strategy and performance.
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