This Aerospace Stock Is About to Take Off

Core Viewpoint - Hexcel is positioned to benefit significantly from the recovery in aircraft production, driven by the easing of supply chain issues and increasing demand for lightweight composites in new aircraft models [1][6]. Group 1: Market Conditions - The commercial aerospace sector has faced challenges due to lockdowns, supply chain crises, and slow recovery in aircraft production from Boeing and Airbus, impacting Hexcel's growth [1]. - Boeing and Airbus have multiyear backlogs and are ramping up production to meet the demand for over 15,000 aircraft, which is expected to positively impact Hexcel [3][6]. Group 2: Growth Drivers - Hexcel's growth is primarily linked to increased aircraft production and the rising use of composites in aircraft, with the Boeing 777X expected to have a 30% composite penetration compared to 10% in the current 777 model [4]. - The supply chain crisis is improving, as indicated by GE Aerospace and RTX raising their guidance due to better parts availability [3]. Group 3: Financial Outlook - Management has authorized $600 million in share buybacks, reflecting confidence in aircraft production rates and Hexcel's market position [6]. - Wall Street anticipates double-digit revenue growth and EBITDA growth of 20% or more for Hexcel over the next few years, indicating the start of a multiyear recovery [6][7].