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Is ATI Positioned for Further Adjusted EBITDA Improvement?
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Key Takeaways
ATI's Q2 adjusted EBITDA rose 37% to $284.4 million, with margin up 440 bps to 22.6%.
ATI lifted full-year 2026 EBITDA guidance to $1.135-$1.185 billion.
Record backlog, long-term deals and higher next-gen engine content support ATI's long-term growth.
ATI Inc. (ATI - Free Report) reported an adjusted EBITDA of $284.4 million in the second quarter of 2026, up 37% on a year-over-year basis. A steep rise in adjusted EBITDA was also reported sequentially. The adjusted EBITDA margin also climbed 440 basis points to 22.6% from 18.2% in the year-ago quarter. As the demand scenario continues to beat the available supply, the momentum is expected to carry into the future.
The company, favored by its record backlog, transition toward a higher-margin portfolio and long-term customer agreements, expects to witness new highs. For full-year 2026, ATI also raised its adjusted EBITDA guidance. It is now projected between $1,135 million and $1,185 million compared with the previous guided range of $1,010-$1,060 million. This has also resulted in increased earnings per share guidance of $4.90-$5.18 for the full-year 2026, compared with the previous guidance of $4.20-$4.48. For the third quarter of 2026, earnings are projected to be $1.31-$1.37 per share.
ATI is also well positioned to benefit in the long-term from growing demand for next-generation engines, naval nuclear programs and other defense applications, where its content on next-generation engines is more than double that of legacy platforms.
Among its major peers, Carpenter Technology Corporation (CRS - Free Report) generated a high adjusted operating income of $206.9 million in the fourth quarter of fiscal 2026 compared with $151.4 million in the year-ago quarter. The improvements in product mix, higher realized prices, as well as expanded operating efficiencies support the expansion. For fiscal 2027, Carpenter Technologyexpects to generate operating income in the range of $850 million to $880 million.
Howmet Aerospace Inc. (HWM - Free Report) recorded second-quarter adjusted EBITDA of roughly $817 million, up from the previous-year quarter’s $589 million. This upside was backed by strong growth in the commercial aerospace, defense aerospace and gas turbines markets. Howmet expects adjusted EBITDA for the third quarter and full-year 2026 to be in the range of $825-$835 million and $3,210-$3,250 million, respectively.
The Zacks Rundown for ATI
Shares of ATI have shot up 142.2% in the past year against the Zacks Aerospace - Defense Equipment industry’s decline of 4.3%.
Image Source: Zacks Investment Research
From a valuation standpoint, ATI is currently trading at a forward price-to-sales multiple of 4.6X, a discount to the industry average of 7.35X. It carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for ATI’s 2026 and 2027 earnings implies a year-over-year rise of 54.01% and 23.73%, respectively. The EPS estimates for 2026 and 2027 have been trending higher over the past 30 days.
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Is ATI Positioned for Further Adjusted EBITDA Improvement?
Key Takeaways
ATI Inc. (ATI - Free Report) reported an adjusted EBITDA of $284.4 million in the second quarter of 2026, up 37% on a year-over-year basis. A steep rise in adjusted EBITDA was also reported sequentially. The adjusted EBITDA margin also climbed 440 basis points to 22.6% from 18.2% in the year-ago quarter. As the demand scenario continues to beat the available supply, the momentum is expected to carry into the future.
The company, favored by its record backlog, transition toward a higher-margin portfolio and long-term customer agreements, expects to witness new highs. For full-year 2026, ATI also raised its adjusted EBITDA guidance. It is now projected between $1,135 million and $1,185 million compared with the previous guided range of $1,010-$1,060 million. This has also resulted in increased earnings per share guidance of $4.90-$5.18 for the full-year 2026, compared with the previous guidance of $4.20-$4.48. For the third quarter of 2026, earnings are projected to be $1.31-$1.37 per share.
ATI is also well positioned to benefit in the long-term from growing demand for next-generation engines, naval nuclear programs and other defense applications, where its content on next-generation engines is more than double that of legacy platforms.
Among its major peers, Carpenter Technology Corporation (CRS - Free Report) generated a high adjusted operating income of $206.9 million in the fourth quarter of fiscal 2026 compared with $151.4 million in the year-ago quarter. The improvements in product mix, higher realized prices, as well as expanded operating efficiencies support the expansion. For fiscal 2027, Carpenter Technologyexpects to generate operating income in the range of $850 million to $880 million.
Howmet Aerospace Inc. (HWM - Free Report) recorded second-quarter adjusted EBITDA of roughly $817 million, up from the previous-year quarter’s $589 million. This upside was backed by strong growth in the commercial aerospace, defense aerospace and gas turbines markets. Howmet expects adjusted EBITDA for the third quarter and full-year 2026 to be in the range of $825-$835 million and $3,210-$3,250 million, respectively.
The Zacks Rundown for ATI
Shares of ATI have shot up 142.2% in the past year against the Zacks Aerospace - Defense Equipment industry’s decline of 4.3%.
Image Source: Zacks Investment Research
From a valuation standpoint, ATI is currently trading at a forward price-to-sales multiple of 4.6X, a discount to the industry average of 7.35X. It carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for ATI’s 2026 and 2027 earnings implies a year-over-year rise of 54.01% and 23.73%, respectively. The EPS estimates for 2026 and 2027 have been trending higher over the past 30 days.
Image Source: Zacks Investment Research
ATI stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.