Bernstein SocGen on Howmet Aerospace Inc. (HWM): 'Stock is down on the SpaceX comments; should be a buying opportunity'

Bernstein SocGen Group analyst Douglas Harned reiterated an Outperform rating and $328.00 price target on Howmet Aerospace Inc. (NYSE: HWM).

The analyst commented: "SpaceX to produce IGT blades? What does that mean? Elon Musk said SpaceX intends to build its own blades and vanes for industrial gas turbines, as it pushes toward installing 20GW of behind-the-meter capacity by the end of 2027 for terrestrial AI data centers in Bastrom, Texas.

Assuming SpaceX does the buildout to produce blades, we would not expect the company to become a new industry supplier of forgings and castings, which would have little connection with core SpaceX objectives. Instead, we expect this to be all about vertical integration, as it is doing in other areas (e.g., solar panels). We also are skeptical that SpaceX would be able to have volume production in time to meet its power expansion goals in 18 months. This is not easy, which is why Howmet has been able to maintain its lead position. Nevertheless, we have little doubt that SpaceX will push forward to build this capability. But, success, we believe is likely to be measured in the company’s ability to meet its own demand needs - not in creating a high volume facility with competitive economics versus the rest of the industry. In the end, that Howmet’s stock is down on the SpaceX comments should be a buying opportunity."

For an analyst ratings summary and ratings history on Howmet Aerospace Inc. click here. For more ratings news on Howmet Aerospace Inc. click here.

Shares of Howmet Aerospace Inc. closed at $244.95 yesterday.

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