All Aerospace-Focused Notes: 
We expect minimal supply chain fallout following the production audible called by Airbus last week. Adjustments to the master schedule appear to be fairly modest, while more importantly, the management team is holding to its aggressive long-term single-aisle aircraft production
The Boeing Company (BA) earnings update was generally in-line with expectations and investors seem comfortable with the updated corporate outlook (despite modestly negative 737 program commentary). The portfolio seems to be coming back together after three turbulent years. Going forward,
We are raising the 2Q22 earnings forecast for The Boeing Company (BA) ahead of the quarterly report (scheduled for next Wednesday) following the better-than-expected commercial aircraft delivery report for the month of June. Despite our relatively subdued 2H22 outlook and
Airbus recently sent updated commercial aircraft product schedules to all major suppliers that may contain information likely to become a much-needed catalyst for the aerospace peer group. Contrary to the negative quarterly updates issued by companies levered to aerospace or
All Specialty Materials-Focused Notes: 
We remain confident with the STRONG BUY investment rating on ATI Incorporated (ATI) following a review of the details collected from the quarterly earnings report and expected commercial aerospace market drivers. There do not appear to be very many
We are upgrading the shares of Carpenter Tech (CRS) to a Strong Buy and raising estimates ahead of the quarterly earnings report scheduled for next week. Management commentary and near-term segment guidance should confirm our bullish thesis and stronger specialty
We are focused on the visible titanium channel strength and recent surge in spot prices for all semi-finished and finished mill product groups. The combination of volume strength, higher price points and favorable contract resets should facilitate solid top-line
We increased Allegheny Technologies (ATI) earnings estimates to account for underlying titanium market optimism and favorable long-term aerospace market share outlook. Our portfolio analysis and updated modeling assumptions ties into a positive-leaning specialty material note issued yesterday morning that referenced
All Individual Company Notes: 
We lowered Boeing Company (BA) estimates to account for the unexpected negative headline pertaining to a forced 737 assembly line halt in May, confirmation of fewer-than-expected aircraft produced during 1H22, reduced 737 rate increase probability in 2H22, and revised commercial
We lowered earnings estimates and our twelve-month price target on The Boeing Company (BA) today after discounting expected effects pertaining to a rigorous FAA aircraft certification process, challenging demand environment, diminished supply chain reliability, and incremental balance sheet stress. The
We spent time reviewing the Haynes International (HAYN) model this week for a better sense of the underlying portfolio earnings power and understanding of the near-term volatility risk against the backdrop of extreme market/cost fluctuations. Preliminary analysis reconfirmed our favorable
There does not appear to be immediate alloy sourcing risk for The Boeing Company (BA) related to the changing Ukraine situation. While Russian supplier, VSMPO-Avisma, represents a large portion of the annual titanium requirement, our updated analysis suggests BA should
Must Read Notes! 
Recent channel intelligence involving a formal Boeing Company (BA) decision to sever ties with Russian titanium supplier, VSMPO-Avisma, should be considered a positive development for the specialty materials group. Presumably, all three domestic producers will eventually become beneficiaries of
The upstream aerospace supply group appears to be entering an accelerated top-line growth environment primarily driven by single-aisle aircraft parts/materials demand strength. Based on the updated commercial aircraft production forecasts applied to the OEMs, combined with modest inventory overhang adjustment,
Rating Change Notes: 
This looks like an interesting point in time for investors to turn more aggressive on Hexcel Corporation (HXL) despite the muted outlook for wide-body aircraft and BA787 aircraft program. Focusing on the improving macro environment, rebounding aerospace supplier survey data
We are lowering Carpenter Technology (CRS) estimates to align with the cautious corporate guidance issued earlier in the week. Capping off a problematic six-month period, the management team attributed an unplanned forge press outage, inflationary pressures, and labor shortage
Hexcel Corporation is one of the companies positioned within the aerospace supply channel with elevated exposure to the market headwinds we highlighted in prior notes, including a destabilized 787 aircraft program (following a pullback in monthly build rates) and volume
We are upgrading the shares of Allegheny Technologies (ATI) to a Strong Buy investment rating, looking to take advantage of the recent trading weakness that seems to be following the quarterly updates issued by various aerospace suppliers. <a
Boeing Company Notes:(BA) 
We updated our Boeing Company (BA) model this morning to account for the relatively cautious near-term outlook provided by the management team and increased 787 program costs. The shares have been under pressure since the issuance of weaker-than-expected 4Q21 earnings
We are lowering estimates on The Boeing Company (BA) ahead of the 4Q21 earnings release scheduled for Wednesday, January 26, focusing on the downward bias to current BCA segment expectations. Upon final review monthly aircraft delivery reports, the recent
We updated The Boeing Company (BA) model today, reacting to some of the information/thoughts shared by industry contacts following a supplier conference call held late last week. Bottom-line, while the management team formally pushed out 787 aircraft recovery expectations
We are lowering estimates on The Boeing Company (BA) today to reflect lower commercial aircraft delivery assumptions and BCA margin contraction risk. Based on market intelligence collected from aerospace suppliers over the past few days, we believe there is increasing
ATI Incorporated Notes:(ATI) 
There is an interesting set up for Allegheny Technologies (ATI) heading toward CY22 as the company exited from the 3Q21 earnings period relatively unscathed by raw material/labor constraints and the commercial aircraft production hiccups. After updating our commercial aerospace
Highlighting mixed-to-negative titanium survey reads and macro headlines over the past few weeks. At this point, our market intelligence and analysis indicate a slight downward bias to near-term earnings expectations for companies levered to titanium and other specialty alloys.
We are increasing Allegheny Technologies (ATI) estimates to account for an increasingly favorable commercial aerospace sales outlook, better-than-expected specialty materials survey results and upward movement in product pricing. After adjusting for the new production schedules shared by jet
This is no time to panic! We are sticking with bullish investment ratings on certain names from the specialty materials group despite recent downward metals and mining trading pressure. Companies like Allegheny Technologies (ATI) and Haynes International (HAYN) should benefit
Carpenter Technology Notes:(CRS) 
We reexamined our investment rating and target price following the issuance of a relatively messy quarterly report and disappointing segment guidance, which forced us to lower fiscal-year estimates. Ultimately, we decided to maintain the STRONG BUY rating on the
We are lowering estimates for Carpenter Technology (CRS) once again to better align with the potential risks highlighted in a report published last week (BA787 and military/defense) and to discount the impact from a delayed ramp in premium alloy mill
We are initiating coverage on Carpenter Technology (CRS) with a Strong Buy investment rating and $50/share target price. Following a short period of trading weakness, we are comfortable with the lower entry point. The shares look undervalued today, especially
We are making a rotational call within the aerospace coverage group, now favoring upstream suppliers that appear to be positioned to benefit from a changing commercial aircraft production environment. The investor narrative may shift to the premium forgers and/or
Haynes International Notes:(HAYN) 
The FY4Q beat, favorable top-line and earnings guidance, and general commentary offered by the Haynes International (HAYN) management team during the recent investor call reaffirms our bullish view on the shares. We believe the portfolio is uniquely positioned to
The HAYN management team is echoing a similar sentiment as most of its direct competitors: While most of the operating results reported this month have been underwhelming and CY21 earnings expectations are generally subdued, the specialty materials peer group seems
We updated the Haynes International (HAYN) model ahead of the FY1Q earnings report, set for later this week. We have been holding a neutral position on the shares, but our bias leans negative following the collection of weak survey
Today, we are formally initiating coverage on Haynes International (HAYN) with a HOLD rating. While we certainly understand the initial exuberance around the aerospace suppliers and specialty materials peer group, following Monday’s vaccination news, we caution investors that underlying
Hexcel Corporation
(HXL)
We came away from the latest Hexcel Corporation (HXL) quarterly earnings update and investor call somewhat intrigued by the latest market outlook, continuation of the cost reduction strategy, and uptick in confidence communicated by the management team. We would consider
We cannot recall another time during our long history in sell-side research when the best idea highlighted from our coverage was: investors should avoid the entire peer group right now. Ultimately, we deemed it more appropriate to shift the
We are downgrading Hexcel Corporation (HXL) to a HOLD rating this morning. Since we issued an upgrade note last month, HXL shares traded 55% higher, exceeding our target price, fueled by election certainty, recent COVID-19 vaccination headlines, and the
Consensus estimates still look aggressive, in relation to fundamentals, for aerospace suppliers levered to premium forge, composite materials, metal fabrication, and raw materials. We believe the tier-3/4 peer group may still be 4-5 quarters away from an inflection