July 06, 2025 a 07:31 am
HWM: Dividend Analysis - Howmet Aerospace Inc.
Howmet Aerospace Inc. (HWM), a leader in the aerospace sector, demonstrates robust financial health through a consistent dividend history and moderate growth prospects. With a current dividend yield, this industrial giant offers long-term stability for dividend-focused investors. Its prudent payout ratios further underscore a conservative financial strategy. 📊
Overview 📈
Howmet Aerospace Inc., operating within the aerospace sector, presents a dividend yield of 0.23%. With the current dividend per share standing at 0.27 USD, the company boasts a solid 10-year history of dividend payments. There has been no recent cut or suspension, reflecting the firm's ongoing commitment to shareholder value.
| Metric | Details |
|---|---|
| Sector | Aerospace |
| Dividend yield | 0.23% |
| Current dividend per share | 0.27 USD |
| Dividend history | 10 years |
| Last cut or suspension | None |
Dividend History 📚
Analyzing Howmet's dividend history reveals a pattern of steady increments evident over the past decade. This commitment to maintaining dividends is essential for income-centric investors seeking reliability and financial prudence.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 0.20 |
| 2024 | 0.26 |
| 2023 | 0.17 |
| 2022 | 0.10 |
| 2021 | 0.04 |
Dividend Growth 📈
The dividend growth over the last three and five years offers insights into the firm's strategic financial planning, scalability, and commitment to rewarding shareholders. Consistent growth signals the company's ability to enhance investor returns.
| Time | Growth |
|---|---|
| 3 years | 0.87% |
| 5 years | 0.23% |
The average dividend growth is 0.23% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio 📊
The payout ratio is a critical marker of financial health, revealing how much of the company's income is distributed as dividends. A lower payout ratio typically indicates ample room for future dividend increases and financial buffers against adverse economic conditions.
| Key figure ratio | Percentage |
|---|---|
| EPS-based | 8.61% |
| Free cash flow-based | 10.61% |
The EPS-based payout ratio of 8.61% and FCF-based ratio of 10.61% reflect financial prudence and implies stability, highlighting the company's capacity to maintain and potentially grow dividends.
Cashflow & Capital Efficiency 💸
Cashflow-derived indicators are pivotal for assessing the company's operational efficiency and investment capabilities. These metrics serve to validate sustainable dividends and capital reinvestment strategies.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 2.19% | 3.06% | 3.29% |
| Earnings Yield | 2.59% | 3.43% | 2.86% |
| CAPEX to Operating Cash Flow | 24.73% | 24.30% | 26.33% |
| Stock-based Compensation to Revenue | 0.85% | 0.75% | 0.95% |
| Free Cash Flow / Operating Cash Flow Ratio | 75.27% | 75.69% | 73.67% |
The robust cash flow ratios underscore HWM's proficient capital management and financial health, suggesting adequate cash reserves for progressive dividend policies and strategic investments.
Balance Sheet & Leverage Analysis 📊
Fundamental leverage metrics provide insight into Howmet Aerospace's debt management and financial stability. These figures are crucial for evaluating the firm's capability to meet financial obligations.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.76 | 0.95 | 1.16 |
| Debt-to-Assets | 0.33 | 0.37 | 0.41 |
| Debt-to-Capital | 0.43 | 0.49 | 0.54 |
| Net Debt to EBITDA | 1.58 | 2.20 | 2.68 |
| Current Ratio | 2.30 | 1.86 | 2.12 |
| Quick Ratio | 0.98 | 0.87 | 1.04 |
| Financial Leverage | 2.31 | 2.58 | 2.85 |
The debt metrics indicate a stable leverage structure with declining debt dependency, enhancing HWM's financial flexibility and long-term solvency.
Fundamental Strength & Profitability 📊
Core profitability measurements assess the efficiency of asset utilization and equity management, crucial for validating the company's ability to maintain growth and shareholders' returns.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 25.36% | 18.95% | 13.02% |
| Return on Assets | 10.98% | 7.34% | 4.57% |
| Margins: Net | 15.55% | 11.52% | 8.28% |
| EBIT | 21.06% | 17.97% | 17.57% |
| EBITDA | 24.79% | 22.06% | 22.25% |
| Gross | 31.10% | 28.12% | 27.55% |
| Research & Development to Revenue | 0.44% | 0.54% | 0.56% |
The growth in margins and returns highlights Howmet Aerospace's proficient equity management and operational efficiency, bolstering shareholder value and sustaining competitive profitability.
Price Development 📈
Dividend Scoring System 🏆
| Category | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend growth | 3 | |
| Payout ratio | 4 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Total Score: 32 / 40
Rating ⭐
Based on the comprehensive review of various financial metrics and trends, Howmet Aerospace Inc. exhibits a commendable dividend profile with an emphasis on stability and moderate growth. The company is rated as a reliable dividend payer, well-suited for long-term investors seeking steady income alongside growth potential. Recommended for portfolio diversification in the aerospace sector.