If you want full access to all our reports, data and investing ideas, join The Aerospace Forum , the #1 aerospace, defense and airline investment research service on Seeking Alpha, with access to evoX Data Analytics, our in-house developed data analytics platform.I covered Hexcel (NYSE: HXL ) in July 2024 and assigned a hold rating to Hexcel stock based on a set of challenges that affect the upside for the company. Since then, the stock has gained 6.2% while the S&PDhierin runs the investing group The Aeros ...

If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider Hexcel (HXL) . This company, which is in the Zacks Aerospace - Defense Equipment industry, shows potential for another earnings beat.This maker of lightweight composite materials has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise ...

In its upcoming report, Hexcel (HXL) is predicted by Wall Street analysts to post quarterly earnings of $0.51 per share, reflecting an increase of 18.6% compared to the same period last year. Revenues are forecasted to be $475.43 million, representing a year-over-year increase of 3.9%.The current level reflects a downward revision of 11.5% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial pro ...

The market expects Hexcel (HXL) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended December 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on January 22, 2025, might help the stock move higher if these key numbers are be ...

Boeing's Impact on Hexcel - Boeing's struggles in 2024 significantly affected Hexcel, a major supplier of carbon fiber materials, leading to a 15% decline in Hexcel's shares despite the S&P 500 rising by 23% [1] - Boeing, a key customer accounting for nearly two-thirds of Hexcel's revenue, reduced its material purchases due to manufacturing and engineering issues, causing a government-ordered slowdown in aircraft production [2][3] - Hexcel was forced to lower its financial expectations for 2024 and withdraw its long-term guidance for double-digit compound annual revenue growth through 2026 due to Boeing's reduced demand [4] Hexcel's Business and Market Position - Hexcel specializes in producing lightweight carbon fiber materials, which are essential for fuel-efficient aircraft and other large equipment, with commercial aerospace making up nearly two-thirds of its revenue [2] - Despite the slump, Hexcel's composite materials remain a critical component of the new plane supply chain, with Airbus forecasting demand for over 42,000 new aircraft deliveries in the next 20 years [7] Investor Sentiment and Capital Management - Investors exited Hexcel in 2024 due to the uncertainty surrounding Boeing's recovery timeline and the lack of control Hexcel management had over external factors [5] - Hexcel managed to return capital to investors by reducing its share count by 4% over the past year and 16% over the past decade, while also paying a modest dividend yielding about 1% [6] Future Outlook - While Hexcel's long-term potential remains strong, the timing of demand recovery is uncertain, and investors will need to wait for Boeing's recovery to see Hexcel's business rebound [7][8]

Core Viewpoint - Hexcel Corporation reported strong Q3 earnings, surpassing estimates, but the stock has underperformed the S&P 500, raising questions about future performance leading up to the next earnings release [1][2][3]. Financial Performance - Adjusted earnings for Q3 2024 were 47 cents per share, a 23.7% increase from 38 cents in the same quarter last year [2]. - GAAP earnings were 49 cents per share, up 8.9% from 45 cents year-over-year [3]. - Total net sales reached $456.5 million, exceeding the Zacks Consensus Estimate of $456.2 million by 0.1% and reflecting an 8.8% increase from $419.5 million in the prior year [4]. Sales Breakdown - Sales in the Commercial Aerospace sector increased by 17.5% year-over-year to $295.9 million, driven by A350, A320neo, and Boeing 787 programs [8]. - Space and Defense sales decreased by 0.5% to $128.2 million due to lower sales from Bell V-22 and space programs [8]. - Industrial sales fell by 16.5% to $32.4 million, attributed to declines in submarkets [8]. Operational Metrics - Gross margin improved to 23.3%, a 150 basis point increase from the previous year, due to favorable cost leverage from higher sales [6]. - Adjusted operating income rose to $52.9 million from $42.8 million year-over-year [7]. Cash Flow and Debt - Cash and cash equivalents as of September 30, 2024, were $98.2 million, down from $227 million at the end of 2023 [9]. - Long-term debt increased to $805.1 million from $699.4 million at the end of 2023 [9]. - Cash flow from operating activities for the first nine months of 2024 was $127.3 million, compared to $98.1 million in the same period last year [9]. Guidance and Estimates - Hexcel has adjusted its 2024 sales guidance to the lower end of the previous range of $1.90-$1.98 billion, with the Zacks Consensus Estimate at $1.91 billion [11]. - The company expects adjusted earnings per share to be at the lower end of the range of $2.02-$2.18, with the current consensus at $2.05 [11]. - Free cash flow is projected to be approximately $200 million in 2024, with capital expenditure expected to remain below $100 million [12]. Market Sentiment - Recent estimates have trended downward, with a consensus estimate shift of -7.11% [13][14]. - Hexcel currently holds a Zacks Rank 5 (Strong Sell), indicating expectations of below-average returns in the coming months [16].

Hexcel Corporation (HXL) reported third-quarter 2024 adjusted earnings of 47 cents per share, which improved 23.7% from the year-ago quarter’s figure of 38 cents.The bottom line also surpassed the Zacks Consensus Estimate of 46 cents by 2.2%.The company reported GAAP earnings of 49 cents per share, which increased 8.9% from the year-ago quarter’s figure of 45 cents. The year-over-year bottom line improvement can be attributed to higher net sales and operating income compared with the prior-year quarter.Tota ...

Hexcel (HXL) reported $456.5 million in revenue for the quarter ended September 2024, representing a year-over-year increase of 8.8%. EPS of $0.47 for the same period compares to $0.38 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $456.18 million, representing a surprise of +0.07%. The company delivered an EPS surprise of +2.17%, with the consensus EPS estimate being $0.46.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and ho ...

Company Performance - Hexcel reported quarterly earnings of $0.47 per share, exceeding the Zacks Consensus Estimate of $0.46 per share, and up from $0.38 per share a year ago, representing an earnings surprise of 2.17% [1] - The company posted revenues of $456.5 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 0.07%, and an increase from year-ago revenues of $419.5 million [1] - Over the last four quarters, Hexcel has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [1] Future Outlook - The sustainability of Hexcel's stock price movement will depend on management's commentary during the earnings call and the company's earnings outlook [2][3] - Current consensus EPS estimate for the coming quarter is $0.55 on revenues of $488.51 million, and for the current fiscal year, it is $2.05 on revenues of $1.91 billion [4] - The estimate revisions trend for Hexcel is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [4] Industry Context - The Aerospace - Defense Equipment industry, to which Hexcel belongs, is currently in the top 33% of over 250 Zacks industries, suggesting a favorable industry outlook [5] - Another company in the same industry, FTAI Aviation, is expected to report quarterly earnings of $0.77 per share, reflecting a year-over-year change of +133.3%, with revenues expected to be $429.29 million, up 47.5% from the year-ago quarter [5]

Financial Performance - Net sales for Q3 2024 were $456.5 million, an increase of 8.8% from $419.5 million in Q3 2023[68] - Operating income for Q3 2024 was $52.5 million, a 20.4% increase from $43.6 million in Q3 2023, resulting in an operating margin of 11.5%[76] - Net income for Q3 2024 was $39.8 million, up 2.8% from $38.7 million in Q3 2023, with diluted net income per share increasing to $0.49[68] - Gross margin for Q3 2024 improved to 23.3% from 21.8% in Q3 2023, attributed to favorable cost leverage from higher sales[74] - Interest expense for Q3 2024 was $8.5 million, a 9.0% increase from $7.8 million in Q3 2023, while the nine-month interest expense decreased by 12.5% to $23.1 million from $26.4 million[77] - The income tax expense for Q3 2024 was $4.2 million compared to a tax benefit of $0.7 million in Q3 2023, with a nine-month tax expense of $27.8 million versus $22.5 million in 2023[78] - The effective tax rate for Q3 2024 was 9.6%, compared to a negative rate of (2.0%) in Q3 2023, while the nine-month effective tax rate was 18.0% versus 15.9% in 2023[78] Segment Performance - Commercial Aerospace segment sales increased by 17.5% to $295.9 million in Q3 2024, driven by strong demand for Airbus A350 and A320neo programs[72] - Composite Materials segment net sales reached $367.6 million in Q3 2024, an 8.0% increase from $340.5 million in Q3 2023[71] - Engineered Products segment net sales increased by 12.5% to $88.9 million in Q3 2024, supported by higher sales in Commercial Aerospace and Space & Defense[71] - Total Industrial sales decreased by 16.5% to $32.4 million in Q3 2024, reflecting declines across all sub-markets[74] Cash Flow and Capital Management - Cash on hand as of September 30, 2024, was $98.2 million, down from $227.0 million at December 31, 2023, while total debt increased to $805.2 million from $699.5 million[79] - Net cash provided by operating activities for the first nine months of 2024 was $127.3 million, up from $98.1 million in the same period last year[81] - Free cash flow for the first nine months of 2024 was $58.9 million, significantly higher than $3.7 million in the same period of 2023[90] - The company repurchased $252.2 million of common stock in the first nine months of 2024, compared to $30.1 million in the same period in 2023[82] - The company has $234.9 million remaining under its share repurchase program as of September 30, 2024[80] - Capital expenditures for the first nine months of 2024 were $68.4 million, down from $94.4 million in the same period last year[81] Challenges and Risks - The company continues to face challenges from global logistics, supply chain issues, and inflationary pressures impacting operations and financial results[67] - There are ongoing challenges related to the availability and cost of raw materials, influenced by supply disruptions and inflation[93] - Cybersecurity risks and potential impacts from breaches are acknowledged as significant concerns[93] - Changes in government defense procurement budgets may affect the company's operations and financial performance[93] - The company acknowledges known and unknown risks that may cause actual results to differ materially from forward-looking statements, including macroeconomic factors and geopolitical issues[93] - Significant customers like Airbus and Boeing are crucial, with potential sales reductions impacting overall performance[93] Strategic Initiatives - The company anticipates future revenue growth based on aircraft production rates from major manufacturers and ongoing strategic initiatives[92] - The company emphasizes the importance of aligning production and inventory levels with customer demand to mitigate risks[93] - Strategic initiatives, including sustainability goals and restructuring activities, are critical for future success[93] - The company highlights the need for timely new product development and capacity expansions to meet customer demand[93] Forward-Looking Statements - There is no obligation to update forward-looking statements or risk factors unless required by law[95] - The company reports no material changes in market risk from the previous Annual Report on Form 10-K[96]