PITTSBURGH - Howmet Aerospace Inc. (NYSE:HWM (BMV:HWM)) shares surged 7.5% following the company's release of second-quarter financial results that exceeded analysts' expectations and guidance that outpaced consensus estimates.
The company reported an adjusted earnings per share (EPS) of $0.65, which was $0.05 higher than the analyst estimate of $0.60. Revenue for the quarter was also strong at $1.88 billion, surpassing the consensus estimate of $1.83 billion.
The robust performance was primarily driven by a 27% growth in the commercial aerospace market, contributing significantly to the 14% year-over-year (YoY) increase in revenue. The company's net income for the second quarter rose to $266 million, up from $193 million in the same quarter last year, with earnings per share climbing from $0.46 to $0.65 YoY. Operating income margin improved notably to 21.2%, a substantial increase from the previous year.
Looking ahead, Howmet Aerospace's guidance for the third quarter of 2024 is optimistic, with EPS projected to be between $0.63 and $0.65, compared to the consensus estimate of $0.60. Revenue expectations for the upcoming quarter are set at $1.845 to $1.865 billion, which also exceeds the consensus estimate of $1.814 billion.
John Plant, Howmet Aerospace Executive Chairman and Chief Executive Officer, commented on the results, stating, "In the second quarter 2024, the Howmet Aerospace team drove another very strong set of results, again exceeding the high end of guidance on all fronts." He attributed the success to the robust commercial aerospace market and highlighted the company's ability to navigate through the challenges faced by aircraft manufacturers.
The company's financial health was further underscored by its cash generation, which allowed for significant debt reduction and share repurchases. Howmet Aerospace repurchased $60 million of common stock and declared a 60% increase in the quarterly common stock dividend to $0.08 per share for the third quarter of 2024.
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