HWM - Howmet Aerospace downgraded to Hold at Benchmark

Howmet Aerospace ( NYSE: HWM ) on Wednesday was downgraded to Hold from an investment rating of Buy by analysts at Benchmark. They said the maker of aircraft parts faces uncertainty as plane makers such as Boeing ( BA ) and Airbus ( OTCPK:EADSF ) grapple with supply-chain bottlenecks.

“Boeing ( BA ) continues to note the supply chain is still fragile, and Airbus ( OTCPK:EADSF ) recently provided disappointing January A320 deliveries,” Josh Sullivan, analyst at Benchmark, said in a February 15 report. “Further, recent Airbus ( OTCPK:EADSF ) production issues appear to be stemming from new areas such as interiors and internal production.”

The A320 is Airbus’s ( OTCPK:EADSF ) single-aisle airplane that competes directly with Boeing’s ( BA ) 737 Max. Both planes have seen strong demand as airlines seek to update and expand their fleets to handle a rebound in air travel.

Airbus ( OTCPK:EADSF ) is scheduled to report Q4 earnings tomorrow. Investors will be looking for signs that the European company can increase deliveries of commercial airplanes.

Howmet ( HWM ) on Tuesday reported Q4 adjusted EPS of $0.38, matching the consensus estimate, and revenue of $1.5 billion, also in line with estimates. Its guidance for 2023 adjusted earnings of was in a range of $1.53 a share to $1.67 a share, with a midpoint of $1.60 a share. The Wall Street consensus was $1.73 a share.

After reporting earnings, Howmet’s ( HWM ) stock advanced 4.7% to close at $43.02 a share on Tuesday. It climbed 23% during the 12 months through February 14, contrasting with a 6% loss for the Standard & Poor’s 500 stock index ( SP500 ).

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