Did Boeing and Airbus’s Ambitious Production Plans Just Shift Hexcel’s (HXL) Investment Narrative?

• In recent news, Boeing and Airbus announced plans to significantly increase aircraft production in the coming years, aiming to meet recovering global air travel demand. This development is particularly impactful for Hexcel, a key supplier of advanced composite materials used extensively in commercial aircraft manufacturing.
• The anticipated production ramp-up by these major aerospace manufacturers could amplify demand for Hexcel's lightweight composites, highlighting the firm's pivotal role in the evolving aerospace supply chain.
• We'll explore how strengthening aircraft production forecasts could sharpen the outlook for Hexcel's long-term revenue and earnings growth.

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Hexcel Investment Narrative Recap

To own shares in Hexcel, you have to believe in a sustained recovery and ramp-up in global commercial aircraft production, since nearly all of Hexcel’s growth drivers are closely tied to aerospace manufacturing cycles. The recent Boeing and Airbus announcements directly address a persistent risk: the company’s deep reliance on these two OEMs, whose production scheduling and financial health have an outsized near-term impact, both positive and negative, on Hexcel’s revenue and earnings trends.

Among Hexcel’s recent updates, the July reaffirmation of full-year 2025 guidance (annual sales between US$1.88 billion and US$1.95 billion) stands out. This is particularly relevant for aircraft parts suppliers, as it signals alignment with OEM ramp-up plans but also reflects management’s caution around lingering production uncertainties and supply chain pressures.

But as much as demand is expected to rise, investors should be aware that any renewed supply chain disruptions affecting major programs could...

Read the full narrative on Hexcel (it's free!)

Hexcel's outlook anticipates $2.5 billion in revenue and $284.0 million in earnings by 2028. This scenario relies on a 10.0% annual revenue growth rate and a $196.0 million increase in earnings from the current $88.0 million.

Uncover how Hexcel's forecasts yield a $67.64 fair value, a 8% upside to its current price.

Exploring Other Perspectives

Four members of the Simply Wall St Community estimate Hexcel’s fair value between US$52 and US$105.79, with wide disagreement across the range. While catalysts from the resurgent aerospace cycle are front of mind for many, risks from supply chain instability remain important to consider for anyone sizing up Hexcel’s future.

Explore 4 other fair value estimates on Hexcel - why the stock might be worth as much as 69% more than the current price!

Build Your Own Hexcel Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Hexcel research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Hexcel research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Hexcel's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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