Hexcel Corporation (NYSE: HXL): Stock That Needs Special Handling

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Eaton Vance Management recently announced the acquisition of new stake in Hexcel Corporation (NYSE:HXL). The institutional investor has increased its shareholding in the Industrials company by 269.53% to 8.9 million shares with purchase of 6.49 million shares. This fresh investment now brings its stake to 10.66% valued currently at $322.15 million. In addition, The Vanguard Group, Inc. raised its holdings by 35487.0 to 7.5 million shares. And Atlanta Capital Management Co. LL. has lifted its position by 105.27% or 1.99 million shares – to 3.88 million shares.

With over 0.75 million Hexcel Corporation (HXL) shares trading Thursday and a closing price of $41.61 on the day, the dollar volume was approximately $31.02 million. The shares have shown a negative weekly performance of -4.98% and its price on 07/09/20 lost nearly -6.22%. Currently, there are 83.70M common shares owned by the public and among those 82.84M shares have been available to trade.

An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 18 analysts who have offered their price forecasts for HXL have a consensus price objective of $39.12. The analysts have set the share’s price value over the next 12 months at a high of $55.00 and a low of $27.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Hexcel Corporation stock is 2.80 for the next 12 months. The average price target is -8.73% below its last price level and a downside to the estimated low will see the stock lose -54.11% over that period. But an upside of 24.35% will see the stock hit the forecast high price target while mean target price for the stock is $36.00.

Insiders at the company have transacted a total of 92 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 44 of these insider trades were purchases, accounting for 264,572 shares. Insider sales of the common stock occurred on 48 occasions, with total insider shares sold totaling 204,769 shares.

The top 3 mutual fund holders in Hexcel Corporation are Eaton Vance Atlanta Capital SMID, Vanguard Total Stock Market Index, and Vanguard Small Cap Index Fund. Eaton Vance Atlanta Capital SMID owns 4.44 million shares of the company’s stock, all valued at over $160.61 million. The company bought an additional 1.19 million shares recently to bring their total holdings to about 5.32% of the shares outstanding. Vanguard Total Stock Market Index sold 15100.0 shares to see its total holdings shrink to 2.44 million shares valued at over $88.18 million and representing 2.92% of the shares outstanding. Vanguard Small Cap Index Fund sold 18724.0 shares to bring its total holdings to over 2.19 million shares at a value of $79.12 million. Vanguard Small Cap Index Fund now owns shares totaling to 2.62% of the shares outstanding.

Shares of Hexcel Corporation (NYSE: HXL) opened at $44.16, down -$0.21 from a prior closing price of $44.37. However, the script later closed the day at $41.61, down -6.22%. The company’s stock has a 5-day price change of -4.98% and 14.38% over the past three months. HXL shares are trading -43.24% year to date (YTD), with the 12-month market performance down to -48.22% lower. It has a 12-month low price of $24.54 and touched a high of $87.00 over the same period. Currently, 0.75 million shares have been traded, compared to an average intraday trading volume of 1.99 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by -6.01%, 9.53%, and -29.92% respectively.

Institutional ownership of Hexcel Corporation (NYSE: HXL) shares accounts for 98.20% of the company’s 83.70M shares outstanding. Mutual fund holders own 53.42%, while other institutional holders and individual stakeholders account for 54.11% and 22.13% respectively.

It has a market capitalization of $3.45B and a beta (3y monthly) value of 1.25. The stock’s trailing 12-month PE ratio is 12.84, while the earnings-per-share (ttm) stands at $3.24. The company has a Quick Ratio of 2.20 with the debt-to-equity ratio at 0.98. Price movements for the stock have been influenced by the stock’s volatility, which stands at 4.93% over the week and 6.23% over the month.

Analysts forecast that Hexcel Corporation (HXL) will achieve an EPS of $0.2 for the current quarter, $0.28 for the next quarter and $1.91 for 2021. The lowest estimate earnings-per-share for the quarter is -$0.03 while analysts give the company a high EPS estimate of $0.35. Comparatively, EPS for the current quarter was $0.94 a year ago. Earnings per share for the fiscal year are expected to increase by 18.30%, and 30.33% over the next financial year. EPS should shrink at an annualized rate of -1.07% over the next five years, compared to 11.00% over the past 5-year period.

If you are looking to buy this stock, then you may note that the average analyst recommendation by 18 brokerage firm advisors rate Hexcel Corporation (HXL) as a “Moderate Buy” at a consensus score of 2.80. Specifically, 5 Wall Street analysts polled rate the stock as a buy, while 11 of the 18 advise that investors “hold,” and 0 rated it as a “Sell.”

Looking at the support for the HXL, a number of firms have released research notes about the stock. Seaport Global Securities stated their Buy rating for the stock in a research note on July 07, 2020, with the firm’s price target at $52. RBC Capital Mkts coverage for the Hexcel Corporation (HXL) stock in a research note released on June 26, 2020 offered a Outperform rating with a price target of $52. BMO Capital Markets was of a view on June 05, 2020 that the stock is Outperform, while Alembic Global Advisors gave the stock Neutral rating on May 22, 2020 $29. Goldman on their part issued Neutral rating on April 15, 2020.

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