$268.03
arrow_drop_down0.36%Is HII a Buy or Sell based on AI Analysis?
Fundamental Analysis
Based on the fundamental analysis of Huntington Ingalls Industries Inc, several key indicators stand out. Firstly, the company's price-to-earnings ratio of 17.36 suggests that investors are willing to pay $17.36 for every dollar of earnings, indicating a reasonable valuation. Additionally, the company's return on equity of 17.96% indicates that the company is efficiently utilizing its shareholder's equity to generate profits. Furthermore, the company's revenue growth of 7.29% and net income of $681M showcase the company's ability to grow its top line while maintaining profitability. The dividend yield of 1.78% also indicates that the company is rewarding its shareholders with regular dividends. Lastly, the company's debt-to-equity ratio of 0.67 suggests a healthy balance sheet with a conservative level of leverage, which can provide stability and resilience during challenging economic conditions. Overall, these fundamental indicators paint a positive picture of Huntington Ingalls Industries Inc's financial health and performance.
Positive Development
Huntington Ingalls Industries has been recognized for its strong earnings prospects, which has been reflected by its upgrade to a Zacks Rank #1 (Strong Buy). The company has been receiving significant contracts from the US Navy, such as the $1.17 billion modification to a contract for work on the USS Boise, and the successful completion of initial sea trials for Virginia-class attack submarine New Jersey (SSN 796). The company's Newport News Shipbuilding division has been successful in launching Virginia-class submarine Massachusetts (SSN 798) and Virginia-class attack submarine New Jersey (SSN 796). HII has been actively involved in community service and social responsibility initiatives, such as hosting Merging Vets & Players Event at Newport News Shipbuilding and supporting the nonprofit Merging Vets and Players.
Negative Development
The company has a high total debt to equity ratio of 0.5974, which could indicate a potential financial risk. The company's current ratio is 0.9499, which is slightly lower than the industry average of 1, indicating potential liquidity issues. The company's payout ratio is 0.2937, which is higher than the industry average, indicating a significant portion of its earnings are being used to pay dividends, potentially affecting its financial health.
Technical Analysis
Huntington Ingalls Industries Inc (HII) has a neutral technical rating based on various indicators. The company's stock price has shown a positive trend, with a seven-day price change of 2.83% and one-month price change of 11.44%. However, there are also some sell signals, as indicated by three technical sell indicators including CCI, WILLR, and STOCHRSI. The stock's beta value of 0.6 suggests lower volatility compared to the overall market, indicating a more stable investment option. Despite the mixed technical signals, Huntington Ingalls Industries Inc's stock has shown steady growth over the past six months, with a 36.52% price change. Additionally, the company's return on equity of 17.96% and return on assets of 4.37% indicate strong financial health and efficiency in generating profits. Investors may want to consider factors such as the stock's PEG ratio of 3.98, price-to-sales ratio of 1.01, and price-to-book ratio of 2.83 when making investment decisions. Overall, while there are some sell signals in the technical analysis, the company's solid financial performance and growth potential make it an interesting prospect for investors.
Conclusion and recommendation
Based on the data provided, it is evident that Huntington Ingalls Industries Inc (HII) is a well-established company in the industrial sector with a strong financial performance. The company has a market cap of $11.74B and a dividend yield of 1.78%, indicating stability and potential for long-term growth. Additionally, Huntington Ingalls Industries Inc has shown solid revenue growth of 7.29% and a net margin of 5.95%, demonstrating efficient management of its assets and operations. With a return on equity of 17.96% and a price-to-earnings ratio of 17.12, the company appears to be performing well in terms of profitability and investor confidence. In conclusion, based on the financial and operational data provided, Huntington Ingalls Industries Inc seems to be a strong investment opportunity for those looking for a stable and potentially lucrative option in the industrial sector. The company's consistent revenue growth, strong profitability metrics, and positive market and industry scores indicate a solid foundation for future growth. Investors may consider adding Huntington Ingalls Industries Inc to their portfolio for a reliable and potentially rewarding long-term investment. However, as with all investments, it is important to conduct further research and consult with a financial advisor before making any decisions.