Aerospace & Defense · NYSE
Current Price
$362.17
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Huntington Ingalls Industries, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Huntington Ingalls Industries, Inc. engages in designing, building, overhauling, and repairing military ships in the United States. It operates through three segments: Ingalls Shipbuilding, Newport News Shipbuilding, and Technical Solutions. The company is involved in the design and construction of non-nuclear ships comprising amphibious assault ships; expeditionary warfare ships; surface combatants; and national security cutters for the U.S. Navy and U.S. Coast Guard. It also provides nuclear-powered ships, such as aircraft carriers and submarines, as well as refueling and overhaul, and inactivation services of ships. In addition, the company offers naval nuclear support services, including fleet services comprising design, construction, maintenance, and disposal activities for in-service the U.S. Navy nuclear ships; and maintenance services on nuclear reactor prototypes. Further, it provides life-cycle sustainment services to the U.S. Navy fleet and other maritime customers; high-end information technology and mission-based solutions for Department of Defense (DoD), intelligence, and federal civilian customers; nuclear management and operations and environmental management services for the Department of Energy, DoD, state and local governments, and private sector companies; defense and federal solutions; and unmanned systems. Huntington Ingalls Industries, Inc. was founded in 1886 and is headquartered in Newport News, Virginia.
ROIC (TTM)
5.1%
ROE (TTM)
12.3%
FCF Yield
7.45%
Based on trailing twelve-month data, HII shows a free cash flow per share of N/A and a ROIC of 5.1%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 7.45% are important context metrics when evaluating HII's stock valuation relative to peers.
The intrinsic value of HII depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether HII is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $362.17. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Huntington Ingalls Industries, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Aerospace & Defense industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting HII's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Huntington Ingalls Industries, Inc., this means projecting how much free cash flow the Aerospace & Defense will produce over the next 5-10 years, then discounting those amounts to today's dollars. HII's ROIC of 5.1% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For HII, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
