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Research Alert: CFRA Maintains Buy Opinion On Shares Of Huntington Ingalls Industries
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Research Alert: CFRA Maintains Buy Opinion On Shares Of Huntington Ingalls Industries
May 8, 2026 10:24 AM

01:00 PM EDT, 05/08/2026 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We decrease our 12-month target price by $53 to $395, led by multiple contraction due to margin concerns. Following the disappointing Q1 earnings, we lower our assumed P/E multiple from 21.0x to 18.5x, applied to our unchanged 2027 EPS estimate of $21.33. During the last three years, HII has traded at an avg. fwd P/E of 16.5x and defense peers are trading at an avg. fwd P/E of 26.0x. Although we reiterate our bullish long-term outlook, we acknowledge concerns about margin compression, and we decrease our 2026 EPS estimate from $17.86 to $17.40. HII reaffirmed its full-year guidance, including shipbuilding revenue of $9.7B-$9.9B with margins of 5.5%-6.5%, and free cash flow of $500M-$600M. The company maintains a robust $54B backlog and expects medium-term revenue growth of ~6% annually in shipbuilding. While near-term margin pressure persists from pre-COVID contracts, we view the long-term outlook as favorable given strong defense spending tailwinds and improving execution on post-COVID ships beginning in 2027.

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