HII's stock has experienced a notable decline in premarket trading, with a drop of $21.08 or -10.8%, bringing the current premarket price to $174.50. This sharp decrease follows the company's recent announcement of its fourth-quarter earnings for 2024, which showed a significant downturn in revenue and profit margins.
In the fourth quarter, HII reported revenues of $3.0 billion, a decrease from $3.2 billion in the same period the previous year. The drop in revenue was attributed to lower volume across all segments. HII's diluted earnings per share for the quarter came in at $3.15, compared to $6.90 in the fourth quarter of 2023, reflecting a concerning 54.3% decrease.
The overall operating income for the quarter was $110 million, with an operating margin of just 3.7%, a significant decline from 9.8% in the prior year. The Newport News Shipbuilding segment, in particular, faced challenges with lower performance and unfavorable adjustments during the quarter.
Despite these setbacks, HII ended the year with a robust backlog of approximately $48.7 billion, primarily due to new contract awards totaling around $12.1 billion in 2024. Chris Kastner, president and CEO of HII, expressed his commitment to advancing the company’s capacity and capabilities into the future.
This premarket decline of HII could be an indication of investor reactions to the disappointing earnings report, reflecting concerns over the company's operational challenges and ability to meet financial expectations moving forward.
For more information on HII's stock performance, you can visit their stock overview here.
