Q4 Earnings Preview for Hexcel (HXL)

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Hexcel Corporation (NYSE:HXL) is scheduled to report Q4 earnings results on February 3, 2020. Management will host a webcast and conference call to discuss its financial results on Tuesday, February 4, at 10 a.m. ET.

The company is expected to report earnings of $0.85/share on revenue of $592.5 million. The consensus earnings per share (EPS) of $0.85/share is based on a poll of 13 analysts and represents a growth of 3.4% over the same quarter last year when the company reported earnings of $0.82/share.

The revenue forecast of $592.5 million based on a poll of 12 analysts implies a year-over-year (YoY) growth of 5.6%. Last year the company reported $561 million in revenue for the quarter.

Expected to report EPS growth of $0.03/share for Q4, 2019
Metric Expected Prior Year YoY Change
Revenue $592.55 $561.00 5.6%
EPS $0.85 $0.82 3.4%

Earnings Call Trends

Historically, management has exceeded analyst expectations 7 out of the last 8 tracked quarters and met expectations 1 quarter. What are your expectations from Hexcel for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q3, 2019 $0.88 $0.90 2.8% Beat
Q2, 2019 $0.90 $0.94 5.0% Beat
Q1, 2019 $0.77 $0.84 9.1% Beat
Q4, 2018 $0.80 $0.82 2.5% Beat
Q3, 2018 $0.79 $0.80 1.3% Beat
Q2, 2018 $0.75 $0.75 0.0% Meet
Q1, 2018 $0.65 $0.68 4.6% Beat
Q4, 2017 $0.69 $0.70 1.4% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending September 30, 2019, the stock price did not react much to the update.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
2019-10-21 $76.17 $75.59 -0.8% Decline
2019-07-22 $80.18 $83.68 4.4% Increase
2019-04-23 $68.28 $68.50 0.3% Increase
2019-01-23 $61.50 $66.03 7.4% Increase

Fundamentals And Technical Analysis

Hexcel is currently trading at $76.95/share, down -1.0% for the day. The company is trading at approximately 88.4% of its 52-week high of $87/share. The company’s stock price is up 1.8% since the last earnings report and down -1.5% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 54.16 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.

NYSE:HXL Stock Price Chart Source: Finbox

Hexcel’s current share price also implies a price-to-book (P/B) multiple of 4.6x. The current share price implies a price-to-earnings (P/E) multiple of 21.6x and a forward P/E multiple of 21.4x.┬áThe following table summarizes some other key fundamental ratios:

Data as of January 21, 2020
Metric Value
Last Fiscal Period FY2019.Q3
Period End Date September 30, 2019
Stock Price (Current) $76.95
P/E Ratio 21.6x
P/E Ratio (Fwd) 21.4x
PEG Ratio 4.6
Total Debt to Capital (%) 15.5%
Levered Free Cash Flow $223.7 million
Enterprise Value / EBITDA 13.5x

Source: Finbox

Company Profile: Hexcel Corporation

Hexcel Corporation is a mid-cap stock with a market capitalization of $6.484 billion and a total enterprise value of $7.629 billion. The company operates in the Industrials sector and the Aerospace & Defense industry.

Hexcel Corporation, together with its subsidiaries, develops, manufactures, and markets structural materials for use in commercial aerospace, space and defense, and industrial markets. It operates in two segments, Composite Materials, and Engineered Products.

The Composite Materials segment manufactures and markets carbon fibers, fabrics and specialty reinforcements, prepregs and other fiber-reinforced matrix materials, structural adhesives, honeycomb, molding compounds, tooling materials, polyurethane systems, and laminates that are used in military and commercial aircraft, wind turbine blades, recreational products, and other industrial applications, as well as in cars, boats, and trains.

The Engineered Products segment manufactures and markets aircraft structures and finished aircraft components, including wing to body fairings, wing panels, flight deck panels, door liners, helicopter blades, spars, and tip caps; and aircraft structural sub-components and semi-finished components used in helicopter blades, engine nacelles, and aircraft surfaces, such as flaps, wings, elevators, and fairings, as well as HexTool tooling, which are mold tools used in the manufacture of composite aircraft structures.

The company sells its products directly through its sales personnel, as well as through independent distributors and manufacturer representatives in the Americas, Europe, the Asia Pacific, Russia, and Africa.

Hexcel Corporation was founded in 1946 and is headquartered in Stamford, Connecticut.

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