Analysts at Bernstein SocGen Group raised Huntington Ingalls Industries Inc.'s stock price target to $341 from $347 while maintaining a Market Perform rating, citing improved margin outlook. Wolfe Research upgraded the stock to Outperform from Peer Perform with a $364 price target.
The upgrades follow Huntington Ingalls' second-quarter results, which reported adjusted earnings per share of $5.27, surpassing the $3.81 consensus estimate. Revenue reached $3.42 billion, exceeding the $3.15 billion forecast, driven by higher shipbuilding revenue and stronger-than-expected margins at the Newport News division.
The company raised its full-year shipbuilding revenue guidance to $10.2 billion–$10.4 billion, up from the prior range of $9.7 billion–$9.9 billion, implying an increase of roughly $500 million at the midpoint. Shipbuilding margin guidance was adjusted to a 6.0%–6.5% range from 5.5%–6.5%, reflecting improved operational efficiency.
Huntington Ingalls and General Dynamics secured a $76.6 billion contract for nine Block VI Virginia-class attack submarines, materials for a tenth boat, and five Build II Columbia-class ballistic missile submarines. The company noted that revenue growth has benefited from pass-through labor costs at Newport News, which began in Q3 2025.
Free cash flow guidance for the full year was reaffirmed at $500 million–$600 million. First-half free cash flow was negative $611 million, but management expects over $1 billion in Q4 2026, driven by incentive payments tied to the contract award, R&D tax credit benefits, and working capital improvements.
Huntington Ingalls' shares have declined 31.85% over the past six months, trading at a P/E ratio of 17.5 with a PEG ratio of 0.68.
