10 Defense Stocks with the Highest EPS Growth in 5 Years

7. Howmet Aerospace Inc. (NYSE:HWM)

EPS Growth, Past 5 Years: 22.24%

Howmet Aerospace Inc. (NYSE:HWM) manufactures components for aircraft engines, fasteners, aluminum wheels for trucks, and titanium structures for aerospace and defense applications.

It is one of the best defense stocks to buy, with an EPS growth of over 22% in the last five years. Howmet Aerospace Inc. (NYSE:HWM)’s impressive financial performance continues to make it an appealing stock for investors. On February 13, the company reported a 9.1% year-over-year increase in Q4 revenue to $1.9 billion. Net income grew 33% from last year to $314 million, driven by robust growth in the commercial aerospace business.

Howmet Aerospace Inc. (NYSE:HWM)’s full-year 2024 revenue stood at $7.4 billion, up 12% from last year. Net income surged 57% to $1.2 billion. The operating income margin stood at 22%. GAAP EPS for the year was recorded at $2.81, compared to $1.83 per share in the prior year.

Hardman Johnston Global Equity Strategy stated the following regarding Howmet Aerospace Inc. (NYSE:HWM) in its Q4 2024 investor letter:

“From a sector standpoint, the main drivers of the portfolio’s outperformance during the fourth quarter were Industrials and Materials. Within Industrials, Howmet Aerospace Inc. (NYSE:HWM) and Vertiv Holdings Co. were the largest contributors to outperformance. Howmet reported an earnings beat during the quarter with broad-based strength spanning across all key segments. In particular, the company’s Engine Products and Fasteners segment performed well. During the earnings call, management spent significant time describing the emerging new growth driver of industrial gas turbines, which are used in gas power plants, which have become a focus for investors due to accelerating demand from AI data centers. Howmet is the leading supplier to the three major producers of these engines and will benefit from both initial purposes and the long-term maintenance demand.”

Wall Street analysts are bullish on Howmet Aerospace Inc. (NYSE:HWM), with a consensus Buy rating and an average share price upside potential of 10%. According to Insider Monkey’s database, 58 hedge funds held a stake in the company at the end of Q4 2024, improving from 45 at the end of the third quarter.