Howmet Aerospace Letter of Recommendations

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University of Texas *

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50710

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Finance

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Apr 3, 2024

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docx

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9

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1 STRATEGIC RECOMMENDATIONS Howmet Aerospace: Letter of Recommendations Kaleb Dull 12/11/2023
Limiting Market Volatility in Howmet Aerospace Howmet Aerospace is an aerospace company that focuses on commercial and defense aerospace, then also focusing on commercial transportation. They are known for their engine products, fastening systems, engineered structures, and forged wheels. Seeing all the different aspects of business that Howmet Aerospace is involved in we can almost assume that this company has some high-end cash flow but one thing that comes with the aerospace business is the demand from its customers. Doing some deep research into this company there has been many topics have been mined about this company and some amazing things that they do for the revolution of this planet but the one thing that has seemed to come up short is the high demand for the economy to be doing well for them to not come up short. When Covid 19 started to take over the population in 2020 this caused many companies struggled including Howmet, we can see the effects on this company through their stocks, and the amount of revenue compared to other years before and after this pandemic. During this recommendation to Howmet Aerospace to narrow down the Market Volatility we will be integrating Howmet into creating, stress tests and threats, diversification, and cash reserve. https://www.aopa.org/ 2
Standing Howmet Aerospace up to the market of the Aerospace industry This is a comparison of Howmet Aerospace's stock price versus the S&P Aerospace & Defense select industry index dividing this stock price by 71 because that is the number of companies combining this stock. In this comparison, we cannot only be able to see the price difference in the market of Howmet and its competitors, but we can also see a visual trend of the difference in the effects of outside factors on these companies in the Aerospace and defense industry. This also gives us a great demonstration of why diversity is so important when it comes to gaining value and always gaining revenue year to year. https://www.aopa.org/ 3 2017 2018 2019 2020 2021 2022 $0 $50 $100 $150 $200 $250 $300 Stock Price to Market Average Comparison Market Average Howet Price
Minimizing Market volatility within Howmet Aerospace Market Volatility is something that we need to dive into and find a way to limit the volatility of Howmet Aerospace. One of the most ideal ways to limit Market Volatility for Howmet Aerospace is Cash Reserves, this is a method to take advantage of the economic downfall and to have usable cash to invest into different aspects of the company when things have when down in cost or value to get a long-term investment to make sure that they will make the money back that was lost in that time frame. Hold some cash to be able to invest in the companies that are doing well and working hard to be able to escape the economic downfall. For example, when COVID hit in 2019 and Pfizer was coming out with vaccines to stop covid from taking over, Howmet could have taken the cash that was held back for this instance and gave given millions of it to Pfizer for $33 a share this means they would have 303 thousand shares and then selling them at the beginning of 2022 when covid was over for 60$ a share, turning the initial 10 million into 18.2 million. https://www.aopa.org/ 4 2019 2020 2021 2022 0 10 20 30 40 50 60 70 80 90 100 Stock price in Howmet and Pfizer Howmet Pfizer
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