MeritValue

Howmet Aerospace Inc.

HWMdata completeness 100%19 fiscal years on file
The thesis, from the filings

Howmet Aerospace Inc. earns about 9% on invested capital, below its ~9% cost of capital, and has bought back 7% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $19.53 and $130.32 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$4.97B1$5.66B2$6.64B3$7.43B3$8.25B3
Net income$258M4$469M5$765M6$1.16B6$1.51B6
Operating cash flow$449M7$733M8$901M9$1.3B9$1.88B9
Capital expenditure$199M10$193M11$219M12$321M12$453M12
Free cash flow (derived)$250M7$540M8$682M9$977M9$1.43B9
Total debt$8.47B13$8.32B14$7.41B15$6.63B16$6.1B16
Cash & equivalents$720M17$791M18$610M19$564M20$742M20
Diluted shares435.0M421.0M416.0M410.0M406.0M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$131.85
your share of equity
Profit it earned you last year
$37.14
Free cash flow it threw off
$35.25
Debt you’d be carrying
$150.25

10 shares is a claim on $131.85 of net worth that earned you $37.14 and generated $35.25 of cash last year, against $150.25 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
9% avg · 5y
FY21 4%FY22 6%FY23 9%FY24 11%FY25 14%

It earned about 9% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−7% shares · 5y

Share count is down 7% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 28% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $19.53 and $130.32 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$130.32
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$977M
DCF · Growth Exit 5Y
$65.26
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$977M
Earnings Power Value
$19.53
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$765M
  • growthAssumed0.0%
Graham Number
$33.18
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $65.26
The three cases
Bear0.0%$21.19
Base20.0%$65.26
Bull20.0%$65.26

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000004281-24-000007 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000004281-25-000011 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000004281-26-000012 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000004281-24-000007 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000004281-25-000011 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000004281-26-000012 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000004281-24-000007 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000004281-25-000011 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000004281-26-000012 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000004281-24-000007 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000004281-25-000011 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000004281-26-000012 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000004281-23-000004 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000004281-24-000007 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000004281-25-000011 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000004281-26-000012 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000004281-23-000004 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000004281-24-000007 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000004281-25-000011 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0000004281-26-000012 (CashAndCashEquivalentsAtCarryingValue)