Is Huntington Ingalls Industries, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Huntington Ingalls Industries, Inc. has moved from attractive to fair. Based on the current metrics, the company appears to be fairly valued. The P/E ratio stands at 22, which is higher than the peer Textron, Inc. with a P/E of 17.37, indicating that Huntington may be priced at a premium compared to some of its peers. Additionally, the EV to EBITDA ratio is 18.51, while Textron's is 14.32, further suggesting a relative overvaluation in terms of earnings potential.
In terms of returns, Huntington Ingalls has shown a year-to-date return of 48.18%, significantly outperforming the S&P 500's 13.30% during the same period. However, over longer periods, such as the 3-year and 5-year returns, the company has underperformed compared to the S&P 500, which raises some concerns about its long-term growth prospects. Overall, while the company is currently fairly valued, its higher valuation ratios compared to peers and mixed performance against the benchmark suggest caution moving forward.