In a report released today, Ronald Epstein from Bank of America Securities reiterated a Sell rating on Huntington Ingalls, with a price target of $260.00.
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Ronald Epstein has given his Sell rating due to a combination of factors affecting Huntington Ingalls. Despite a significant year-to-date increase in stock price driven by strong demand for shipbuilding, Epstein remains cautious about the company’s profitability. The company’s role as a major nuclear submarine shipbuilder in the US provides some stability, yet the expected shipbuilding volumes may not translate into higher profits.
Moreover, while Huntington Ingalls is making strides in hiring and retaining a skilled workforce, these efforts will take time to yield substantial improvements. The company also faces challenges with project delays, such as the deferral of the CVN 79 carrier delivery. Additionally, the Mission Technologies segment, despite outperforming expectations in the second quarter, faces potential headwinds from contract restructuring and slowing award activity. These factors contribute to Epstein’s cautious outlook and Sell rating.
Based on the recent corporate insider activity of 138 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of HII in relation to earlier this year.