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Investing.com - BMO Capital raised its price target on Hexcel Corp . (NYSE:HXL) to $67.00 from $52.00 on Tuesday, while maintaining a Market Perform rating on the aerospace materials supplier. The new target sits within the broader analyst range of $55-$71, with the stock currently trading at a notably high P/E ratio of 56.7x.
The firm noted that Hexcel reported better-than-expected earnings, partly due to tax benefits, with stronger performance in its Defense segment offsetting challenges elsewhere.
BMO Capital highlighted ongoing margin pressures at Hexcel, citing high labor costs and continued destocking across the aerospace supply chain as persistent headwinds for the company.
The research firm expects Hexcel to face a decline in third-quarter performance due to sustained destocking pressure and typical seasonal weakness before seeing recovery in the fourth quarter, driven by production ramps for the Airbus A350 and Boeing (NYSE:BA) 787 programs.
Despite signs of improvement in the broader aerospace supply chain, BMO Capital views Hexcel’s risk/reward profile as "relatively balanced" following the stock’s recent price appreciation.
In other recent news, Hexcel Corporation reported its second-quarter earnings for 2025, exceeding analysts’ expectations. The company achieved an adjusted diluted earnings per share of $0.50, surpassing the projected $0.46. Hexcel’s revenue also outperformed forecasts, reaching $490 million compared to the anticipated $474.69 million. Despite these positive earnings results, the stock experienced a decline in aftermarket trading, attributed to broader market concerns and sector-specific challenges. Additionally, UBS adjusted its price target for Hexcel, raising it to $65 from $60 while maintaining a Neutral rating. UBS’s revised price target reflects the firm’s assessment of Hexcel’s growth potential, driven by a substantial backlog of large commercial aircraft orders. These developments provide investors with a clearer view of Hexcel’s current financial standing and future prospects.
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