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Chicago, IL – June 13, 2025 – Zacks Equity Research shares Howmet Aerospace HWM as the Bull of the Day and Sociedad Quimica y Minera de Chile SQM as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Goldman Sachs GS, BlackRock BLK and Marsh & McLennan MMC.
Here is a synopsis of all five stocks:
Howmet Aerospace is a global provider of advanced engineering solutions for the aerospace and transportation industries. Formerly known as Arconic, Howmet Aerospace was founded in 1888 and is headquartered in Pittsburgh, Pennsylvania.
This stock is displaying relative strength this year and has been making a series of all-time highs. The broader aerospace sector held up extremely well through the market volatility earlier in the year. Increasing volume has attracted investor attention as buying pressure accumulates in this top-ranked stock.
A Zacks Rank #1 (Strong Buy), Howmet is part of the Zacks Aerospace - Defense industry group, which currently ranks in the top 27% out of more than 250 industries. Because this group is ranked in the top half of all Zacks Ranked Industries, we expect it to outperform the market over the next 3 to 6 months, just as it has so far this year:
Take note of the favorable characteristics for this group below. Stocks in this industry are relatively undervalued based on traditional valuation metrics. They are also projected to experience above-average earnings growth, which signifies a powerful combination that should lead to higher prices in the future.
Historical research studies suggest that approximately half of a stock's price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It's no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top industries, we can dramatically improve our stock-picking success.
The strongest driver of Howmet's business at the moment is the commercial aerospace market. The strength in air travel continues with wide-body aircraft demand also picking up, supporting resilient OEM spending.
Pickup in air travel is generally positive for the company because the increased usage of aircraft spurs spending on parts that Howmet provides and also encourages airlines to buy more aircraft, which further boosts its sales.
Howmet offers airfoils and seamless rolled rings primarily for aircraft engines and industrial gas turbines. The company also produces aerospace fastening systems as well as commercial transportation, industrial, and other fasteners.
Revenues from the commercial aerospace market increased 9% year-over-year in the first quarter of 2025, constituting 52% of its business. The sustained strength was attributed to new, more fuel-efficient aircraft with reduced carbon emissions and increased spare demand for engines.
An expanding defense budget also remains a key catalyst for Howmet. The defense side of the industry has been witnessing positive momentum, cushioned by steady government support. The company has been experiencing robust orders for engine spares for the F-35 program and new builds for legacy fighters. In the first quarter, revenues from the defense aerospace market increased 19% from the prior-year period, accounting for 17% of the company's revenues.
Howmet has built an incredible track record in terms of surpassing earnings estimates; the company hasn't missed the EPS mark since 2020.
Just a few short weeks ago, Howmet delivered first-quarter earnings of 86 cents per share, which marked an 11.6% surprise over the 77-cent consensus estimate. Total revenues of $1.94 billion also exceeded projections and jumped 6% from the year-ago quarter.
The aerospace and defense leader delivered a trailing four-quarter average earnings surprise of 8.8%. Consistently beating earnings estimates is a recipe for success.
Following the strong performance, Howmet raised its 2025 adjusted EPS outlook, reflecting confidence in its operational execution and exposure to flourishing aerospace markets. The company increased its full-year EPS guidance to a range of $3.36-$3.44 compared with $3.13-$3.21 expected earlier.
Howmet continues to witness rising earnings estimates as the company benefits from momentum in the commercial aerospace market. Analysts covering HWM increased their full-year EPS estimates by 6.13% in the past 60 days. The 2025 Zacks Consensus Estimate now stands at $3.46/share, translating to a healthy 28.6% growth rate versus last year.
This market leader has seen its stock advance more than 50% already this year, all while the general market witnessed a drastic correction. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.
The stock has been making a series of higher highs throughout the past year. With both strong fundamental and technical indicators, HWM stock is poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Howmet has recently witnessed positive revisions. As long as this trend remains intact (and Howmet continues to deliver earnings beats), the stock will likely continue its bullish run.
Howmet's measures to reward shareholders are encouraging. In the first quarter of 2025, the company paid dividends of $42 million and repurchased shares worth $125 million. Its sound liquidity position is an added positive.
Backed by a leading industry group and history of earnings beats, it's not difficult to see why HWM stock is a compelling investment. Robust fundamentals combined with an appealing technical trend certainly justify adding shares to the mix.
Recent positive earnings estimate revisions should also serve to create a 'floor' in terms of any sudden or unexpected downside moves. If you haven't already done so, be sure to put HWM on your shortlist.
Sociedad Quimica y Minera de Chile produces and distributes specialty plant nutrients and fertilizers, lithium derivatives, and industrial chemicals. The company provides potassium chloride and sulfate for crops such as corn, rice, wheat, and sugar. It also provides iodine for use in medical, industrial, and pharmaceutical applications.
In addition, SQM offers lithium carbonates for various applications such as materials for batteries, air-conditioning chemicals, and heat-resistant glass. Sociedad Quimica y Minera was incorporated in 1968 and is headquartered in Santiago, Chile.
SQM stock is a Zacks Rank #5 (Strong Sell) and is a component of the Zacks Chemical - Specialty industry group, which ranks in the bottom 40% out of approximately 250 Zacks Ranked Industries. As such, we expect this industry group as a whole to underperform the market over the next 3 to 6 months, just as it has over the course of the past year.
Candidates in the bottom tiers of industries can often be potential short candidates. While individual stocks have the ability to outperform even when included in a poorly-performing industry group, the inclusion in a weaker group serves as a headwind for any potential rallies and the journey forward is that much more difficult.
As a part of this group, SQM stock has experienced considerable volatility in 2025; shares recently touched a 52-week low earlier in June. The stock has not participated much in the recovery off the general market's April lows, signaling low investor confidence.
SQM has fallen short of earnings estimates in each of the past four quarters. The company most recently reported first-quarter earnings back in May of 48 cents per share, missing the $0.63/share consensus estimate by 23.8%. Earnings plunged 40% from the same quarter in the prior year.
The fertilizer company has missed earnings estimates by an average of 23.9% over the past four quarters. Consistently falling short of earnings estimates is a recipe for underperformance, and SQM is no exception.
Sociedad Quimica y Minera has been on the receiving end of negative earnings estimate revisions as of late. For the second quarter, analysts have decreased estimates by 25.97% in the past 60 days. The Q2 Zacks Consensus EPS Estimate now stands at $0.57/share, translating to negative growth of -24% relative to last year.
Falling earnings estimates are a huge red flag and need to be respected. Negative growth year-over-year is the type of trend that bears like to see.
The stock is making a series of lower lows, with no respite from the selling in sight. Both moving averages have rolled over and are sloping down – another good sign for the bears.
While not the most accurate indicator, SQM stock has also experienced a death cross, wherein the stock's 50-day moving average crosses below its 200-day moving average. SQM would have to make a stern move to the upside and show increasing earnings estimate revisions to warrant taking any long positions in the stock. Shares have fallen more than 25% in the past year alone.
A deteriorating fundamental and technical backdrop show that this stock is not set to hit new highs anytime soon. The fact that SQM is included in one of the worst-performing industry groups provides yet another headwind to a long list of concerns.
A history of earnings misses will likely serve as a ceiling to any potential rallies, nurturing the stock's downtrend.
SQM shares continue to experience substantial volatility and have widely underperformed this year. With negative earnings estimate revisions continuing to pile up, this stock should be avoided as there are plenty of better alternatives in the current market environment.
Goldman Sachs is gaining momentum in Japan as part of its broader strategy to expand across Asia. The company's outsourced Chief Investment Office (CIO) model has started to attract interest, signaling meaningful progress in a traditionally competitive market.
The momentum builds on years of groundwork in the region, with senior leadership reaffirming Japan as a strategic market under Goldman's restructured asset and wealth management division. The company is differentiating itself by offering in-house investment products that span both traditional and alternative asset classes, providing more integrated solutions for clients.
The company's growing traction reflects a shift in the Japanese financial landscape, where more investors are engaging with global advisory platforms. GS's CIO approach emphasizes long-term portfolio planning, aiming to deliver more personalized strategies in response to changing investor needs.
As Goldman continues to scale its operations in the region, its ability to combine global investment capabilities with localized execution could help unlock further opportunities. The recent uptick in engagement marks a step forward in solidifying its wealth presence in Japan.
Not only Goldman Sachs, but also other global players like BlackRock and Mercer Inc., part of Marsh & McLennan, are also active in Japan's OCIO space.
BlackRock has already landed key clients in the country, reinforcing its role as a major competitor in this segment. Since 1999, BlackRock has been expanding its footprint in Japan. It is now broadening its overseas investment offerings tailored to Japanese investors, particularly focusing on demand for global fixed income, private assets, and thematic strategies.
Another competitor, Mercer Inc., has a strong presence in Japan, too. The firm, under Marsh & McLennan, is collaborating with Mizuho Trust & Banking through its subsidiary, Asset Management One Co., Ltd. The partnership, led by Mercer under Marsh & McLennan, focuses on delivering solutions that include optimized asset management across classes and addressing talent shortages with enhanced risk management. As Goldman looks to expand market share in Japan, it will face stiff competition from these established firms.
Over the last six months, GS shares have gained 6.6% year to date compared with the industry's growth of 7.4%.
From a valuation standpoint, Goldman trades at a forward price-to-earnings (P/E) ratio of 13.28X, below the industry's average of 13.8X.
The Zacks Consensus Estimate for GS's 2025 and 2026 earnings implies year-over-year growth of 9.6% and 13.1%, respectively. The estimates for 2025 and 2026 have been unchanged over the past 30 days.
Goldman currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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This article originally published on Zacks Investment Research (zacks.com).
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