Howmet Aerospace (NYSE:HWM) and Arconic (NYSE:ARNC) are both construction companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Profitability

This table compares Howmet Aerospace and Arconic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Howmet Aerospace 3.59% 22.09% 5.81%
Arconic N/A N/A N/A

Insider and Institutional Ownership

83.9% of Howmet Aerospace shares are held by institutional investors. 0.1% of Howmet Aerospace shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Howmet Aerospace and Arconic, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Howmet Aerospace 0 1 0 0 2.00
Arconic 1 3 6 0 2.50

Howmet Aerospace currently has a consensus target price of $14.00, suggesting a potential upside of 29.99%. Arconic has a consensus target price of $29.75, suggesting a potential upside of 256.71%. Given Arconic’s stronger consensus rating and higher possible upside, analysts plainly believe Arconic is more favorable than Howmet Aerospace.

Earnings & Valuation

This table compares Howmet Aerospace and Arconic’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Howmet Aerospace $14.19 billion 0.33 $470.00 million $2.11 5.10
Arconic $7.28 billion 0.12 $225.00 million $2.41 3.46

Howmet Aerospace has higher revenue and earnings than Arconic. Arconic is trading at a lower price-to-earnings ratio than Howmet Aerospace, indicating that it is currently the more affordable of the two stocks.

Summary

Howmet Aerospace beats Arconic on 9 of the 13 factors compared between the two stocks.

About Howmet Aerospace

Howmet Aerospace Inc. provides advanced engineered solutions for the aerospace and transportation industries. It offers jet engine components, aerospace fastening systems, and titanium structural parts for mission-critical performance and efficiency in aerospace and defense applications, as well as forged wheels for commercial transportation. The company, formerly known as Arconic Inc., is headquartered in Pittsburgh, Pennsylvania.

About Arconic

Arconic Inc. engineers, manufactures, and sells lightweight metals worldwide. The company operate in three segments: Engineered Products and Solutions, Global Rolled Products, and Transportation and Construction Solutions. The Engineered Products and Solutions segment produces and sells fastening systems and seamless rolled rings; investment castings, including airfoils and forged jet engine components; and extruded, machined, and formed aircraft parts for aerospace (commercial and defense), industrial, commercial transportation, and power generation end markets. It also offers various forged, extruded, and machined metal products for the oil and gas, automotive, and land and sea defense end markets. The Global Rolled Products segment produces and sells aluminum sheets and plates for the aerospace, automotive, commercial transportation, packaging, building and construction, and industrial products end markets; and aseptic foils for the packaging end market. The Transportation and Construction Solutions segment provides integrated aluminum structural systems, architectural extrusions, and forged aluminum commercial vehicle wheels, which are used primarily in the commercial transportation and nonresidential building and construction end markets. It also produces aluminum products for the industrial products end market. Arconic Inc. sells its products directly to customers, as well as through distributors. The company was founded in 1888 and is based in New York, New York.

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