Morgan Stanley Names Top Aerospace Pick to Replace FTAI By Investing.com

Morgan Stanley named Howmet Aerospace (NYSE: HWM) as its top aerospace pick, replacing FTAI Aviation, while it keeps a bullish view for the industry heading into third-quarter 2026 earnings despite softer investor sentiment. The investment bank said underlying fundamentals remain stronger than market mood across both commercial aerospace and defense. Analysts argued demand is still robust, with supply chain execution—not weakening demand—being the main constraint on growth. Morgan Stanley upgraded Howmet following a recent aftermarket “de-rating,” calling the commercial aftermarket selloff overdone. It highlighted constrained capacity in specialty metals, castings, and forgings and “unprecedented” industrial gas turbine demand, suggesting pricing power should persist. The firm expects strong third-quarter 2026 results and says the bar for positive surprises is relatively low.