Robust Demand For Travel And an Aging Global Aircraft Fleet Lifted Howmet Aerospace (HWM) In Q3

Fidelity Investments, an investment management company, recently released its “Fidelity Growth Strategies Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. Fidelity Growth Strategies Fund is a diversified domestic equity strategy with a focus on mid-cap growth. the fund’s Retail Class shares gained 6.28% in the third quarter, modestly underperforming the 6.54% return of the benchmark Russell Midcap® Growth Index. Throughout the three months, the U.S. Federal Reserve’s long-awaited shift to lowering interest rates, the promise of artificial intelligence, and robust corporate profits boosted U.S. mid-cap growth stocks. Value equities drove the surge, while those with mid- and small-caps outperformed those with large-caps. In addition, you can check the fund’s top 5 holdings to know its best picks in 2024.

Fidelity Growth Strategies Fund highlighted stocks like Howmet Aerospace Inc. (NYSE:HWM), in the third quarter 2024 investor letter. Howmet Aerospace Inc. (NYSE:HWM) offers advanced engineered solutions for the aerospace and transportation industries that operate through Engine Products, Fastening Systems, Engineered Structures, and Forged Wheels segments. The one-month return of Howmet Aerospace Inc. (NYSE:HWM) was 5.65%, and its shares gained 125.44% of their value over the last 52 weeks. On December 5, 2024, Howmet Aerospace Inc. (NYSE:HWM) stock closed at $120.07 per share with a market capitalization of $48.788 billion.

Fidelity Growth Strategies Fund stated the following regarding Howmet Aerospace Inc. (NYSE:HWM) in its Q3 2024 investor letter:

“Lastly, an overweight in jet engine components maker Howmet Aerospace Inc. (NYSE:HWM) (+29%) contributed as well. In July, management announced that Q2 financial results exceeded expectations, with earnings surging by 52% due to robust demand for travel and an aging global aircraft fleet, which resulted in substantial backlogs for aircraft manufacturers. Consequently, management raised 2024 earnings and revenue guidance, hiked the company’s quarterly dividend by 60%, and increased its share-buyback program.”

Engineers examining stress tests of an aircraft engine, working to make sure its ready for flight.

Howmet Aerospace Inc. (NYSE:HWM) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held Howmet Aerospace Inc. (NYSE:HWM) at the end of the third quarter which was 45 in the previous quarter. In the third quarter, Howmet Aerospace Inc. (NYSE:HWM) delivered 11% year-over-year revenue growth, following a robust 14% increase in the first half. While we acknowledge the potential of Howmet Aerospace Inc. (NYSE:HWM) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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