Hexcel stock rating upgraded by UBS on widebody production growth

Published 02/09/2025, 10:26
Hexcel stock rating upgraded by UBS on widebody production growth

Investing.com - UBS upgraded Hexcel Corp. (NYSE:HXL), the $5 billion market cap aerospace materials company, from Neutral to Buy and raised its price target to $80.00 from $65.00. According to InvestingPro data, the stock currently trades at a high earnings multiple with a P/E ratio of 58.4.

The investment firm cited expected inflection in widebody aircraft production in 2026 as a key driver for the aerospace materials company’s growth prospects.

UBS analyst Gavin Parsons projects that the production increase will generate mid-teens revenue growth for Hexcel, along with a 300 basis point margin expansion.

While UBS acknowledged challenges in the third quarter related to Airbus A350 destocking, it believes this period could represent a trough for both revenue and margins before a more stable multi-year aircraft production ramp begins.

The firm forecasts 5-7% upside to consensus EBITDA estimates for Hexcel in 2026 and 2027, as improved production stability should enable better cost alignment for the company.

In other recent news, Hexcel Corporation reported its second-quarter earnings for 2025, exceeding analysts’ expectations with an adjusted diluted earnings per share of $0.50, against a forecast of $0.46. The company also reported a revenue of $490 million, surpassing the anticipated $474.69 million. Analysts from Jefferies raised Hexcel’s stock price target to $65, citing a projected 13% compound annual growth rate in production from 2025 to 2027. BMO Capital also increased its price target for Hexcel to $67, noting better-than-expected earnings due in part to tax benefits and strong performance in the Defense segment. UBS adjusted Hexcel’s price target to $65, maintaining a Neutral rating, and highlighted the growth potential supported by a large commercial aircraft backlog. These developments reflect a positive outlook from various analyst firms regarding Hexcel’s future performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.