Friday, November 01, 2024
Haynes International, Inc. is a leading developer, manufacturer and marketer of technologically advanced, nickel and cobalt-based high-performance alloys, primarily for use in the aerospace, industrial gas turbine and chemical processing industries.
Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Boeing strike. In fiscal year 2023 and for the first nine months of fiscal 2024, aerospace represented 49% and 51% of Haynes’ net revenue. A significant portion of the company’s aerospace sales are dependent on the number of aircraft built by The Boeing Company and Airbus. On September 13, Boeing union members went on strike after rejecting a contract proposal from the company. Boeing has extended a pause on component shipments for several of its programs. While we are hopeful that the strike will be resolved soon, we expect it to have a negative impact on Haynes’ fourth quarter of fiscal year 2024 which ended September 30 and the first quarter of fiscal year 2025 which ends on December 31, 2024. Seasonally, the first quarter of the fiscal year is generally the company’s weakest.
Updating estimates. We have lowered our 2024 EBITDA and EPS estimates to $67.4 million and $2.46, respectively, from $68.5 million and $2.52. The revisions reflect weaker demand in the aerospace segment and lower sales expectations for the fourth quarter. Our expectations for weaker demand extend into fiscal year 2025, and we have lowered our EBITDA and EPS estimates to $82.5 million and $3.35, respectively, from $99.5 million and $4.15. Our revisions reflect lower shipment, revenue, and margin expectations, particularly during the first half of the year.
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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
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