Latest news with #Hexcel
Yahoo
22-05-2025
- Business
- Yahoo
2 Unpopular Stocks that Deserve Some Love and 1 to Turn Down
Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory. At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. Keeping that in mind, here are two stocks where Wall Street's pessimism is creating a buying opportunity and one where the skepticism is well-placed. Consensus Price Target: $58.09 (11.9% implied return) Founded shortly after World War II by a group of engineers from UC Berkley, Hexcel (NYSE:HXL) manufactures lightweight composite materials primarily for the aerospace and defense sectors. Why Does HXL Worry Us? Sales tumbled by 3.8% annually over the last five years, showing market trends are working against its favor during this cycle Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term 8 percentage point decline in its free cash flow margin over the last five years reflects the company's increased investments to defend its market position At $51.89 per share, Hexcel trades at 22.8x forward P/E. Read our free research report to see why you should think twice about including HXL in your portfolio, it's free. Consensus Price Target: $74.53 (-8% implied return) Best known for its wide assortment of user-generated content, Roblox (NYSE:RBLX) is an online gaming platform and game creation system. Why Do We Watch RBLX? Daily Active Users are rising, meaning the company can increase revenue without incurring additional customer acquisition costs if it can cross-sell additional products and features Brand halo makes it a customer acquisition machine that onboards new users at scale without spending much money Excellent EBITDA margin of 20.5% highlights the efficiency of its business model Roblox is trading at $81 per share, or 47.9x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it's free. Consensus Price Target: $300.30 (-3.3% implied return) Founded in 1992 as a scientifically-driven alternative to traditional contract research organizations, Medpace (NASDAQ:MEDP) provides outsourced clinical trial management and research services to help pharmaceutical, biotechnology, and medical device companies develop new treatments. Why Does MEDP Stand Out? Existing business lines can expand without risky acquisitions as its organic revenue growth averaged 17.8% over the past two years Share repurchases over the last five years enabled its annual earnings per share growth of 35.1% to outpace its revenue gains Returns on capital are climbing as management makes more lucrative bets Medpace's stock price of $310.55 implies a valuation ratio of 23.7x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free.
Yahoo
16-05-2025
- Business
- Yahoo
DCS superintendent on demands for property tax refunds: 'When does this end?'
May 16—Decatur City Schools Superintendent Michael Douglas on Thursday said companies are increasingly demanding refunds of property taxes they have paid by pointing to external factors that arguably reduced the market value of their property, a practice that makes it impossible for the school system to control its budget. Douglas was focused on Hexcel, a Decatur manufacturer that has claimed in court that the market value of its equipment and real property fell due to COVID. The company asserts that an appraisal by the Morgan County revenue commissioner, used to make assessments for tax years 2021 and 2022, led to it paying $3.2 million more in taxes than it should have, Douglas said. Half of any refund to Hexcel would come from DCS. Last year, Douglas said, DCS had to refund over $200,000 to Indorama. According to court records, Indorama has two more pending claims seeking additional refunds. At issue is "economic obsolescence," which refers to a loss in an asset's value due to external factors outside the company's control. These factors can impact the asset's ability to generate income and its market value. "Who's to say four years from now they won't claim tariffs caused obsolescence?" Douglas said in a press conference Thursday. Complicating the problem for DCS is that it is not a party to Hexcel's court action even though its stands to lose the most money. Hexcel appealed the revenue commissioner's assessment to the Morgan County Board of Equalization, which affirmed the assessment. Now Hexcel — like Indorama — has appealed the Board of Equalization's decision to the Morgan County Circuit Court. Only the companies and the board are parties to the appeals. DCS has filed a motion to intervene in the Hexcel appeal which has not been ruled on by Circuit Judge Jennifer Howell. "We were told it's pretty much their decision what they settle for, and I'm like, if I'm paying half of the money back, shouldn't I have a seat at the table?" Douglas said. Because DCS is not a party to the action, Douglas said, he was unaware of the appeal — and the possibility that DCS would have to refund money it spent years ago — until April 25, when he met with the revenue commissioner. Hexcel's initial appeal was filed Aug. 12, 2021. "My teachers, my parents went through COVID. We don't get to claim obsolescence," Douglas said. "That billion dollar company already received about $3.4 million in tax abatements from the city, so why are they coming back now trying to get the money allocated to the schools?" Douglas said the budgetary impact on DCS could be devastating if other companies also claim an entitlement to refunds. "When does this end? I've got 50 industries up and down the river that can just arbitrarily (say), 'Hey, tough times. Obsolescence. We overpaid our taxes. We want money back.' "I don't know how a school system budgets when you're coming back after the fact. This is 2021, 2022 money that's already been spent." Douglas said Hexcel's claim impacts eight entities that receive property taxes, but DCS is hit the hardest because Hexcel is within the city limits. Refunds to companies like Indorama, which is outside city limits, have a greater impact on Morgan County Schools. A proposed settlement of the Hexcel claim that calls for a $1.4 million refund — $700,000 of it from DCS — has been agreed to by Hexcel, the state and the Morgan County Commission, but not by DCS. "There's only two ways to handle that. You either have to cut or you have to go into your savings," Douglas said. "Now thankfully we've been great stewards of our money. We're going to protect the classrooms, but we'll have to pass a deficit budget. My fear is ... where does this end? "Toray, Nucor Steel, 3M — all that industry up and down the river now have a playbook. All you've got to do is say, 'Obsolescence. My equipment's getting obsolete. I overpaid taxes.' I don't see how a school system continually takes $700,000 hits, $200,000 hits." He said DCS will absorb any refund they have to pay to Hexcel, but that could change in the future. "There will come a time when Decatur City Schools can't," he said, noting that a $700,000 cut translates to laying off 10 teachers. Hexcel manufactures polyacrylonitrile, a precursor to carbon fiber, at its Decatur plant. Its primary customers are in the commercial aerospace industry. In its appeal, it said COVID sharply reduced air travel, causing a "steep decline in demand for new aircraft from commercial airlines" and cancellation of numerous orders. It said these factors forced Hexcel to idle most of its Decatur facility, a fact that it argued should have reduced its property tax assessment. Walter Scott, Hexcel's lawyer, said the fault lies with the Morgan County Revenue Commission and its faulty valuation. "... The county delayed hiring an appraiser to test their valuation until 2025," he said in an email. "Once the county hired its own independent appraiser, from Chicago, he confirmed the county had overvalued and therefore overtaxed Hexcel's property. Hexcel therefore was forced to pay the increased tax and the county, and whoever benefits from the tax, has had the benefit of the company's money for all these years." Scott said the proposed settlement is considerably less than it could have been. "Hexcel continues to pay significant property taxes, and other taxes, and only seeks to be taxed fairly and in accordance with applicable laws so that it is not unfairly disadvantaged," he wrote. "Hexcel contributes to the community in many ways. Hexcel also employs members of the community who participate in the community paying taxes and contributing to philanthropic and civic organizations." Douglas said he wants state law to be revised so there is more clarity in valuations for property tax purposes. "There needs to be clear-cut rules for how industry is assessed, so there is no ambiguity," he said. — eric@ or 256-340-2435
Yahoo
16-05-2025
- Business
- Yahoo
Decatur City Schools Superintendent speaks on tax settlement implications
DECATUR, Ala. (WHNT) — Several school systems in Morgan County are trying to figure out how to repay money that was previously allotted to them, after a tax lawsuit settlement. This comes after a billion-dollar corporation sued the Morgan County Department of Revenue, saying it was improperly assessed in 2021 and 2022. Decatur City Schools is one of the districts feeling the impact. 'I don't know how a school system budgets when you're coming back after the fact,' said DCS Superintendent Michael Douglas. 'This is 2021, 2022 money that's already been spent.' 📲 to stay updated on the go. 📧 to have news sent to your inbox. Douglas told News 19 that the situation is frustrating. Based on the settlement agreement between Hexcel and the Morgan County Board of Equalization, Decatur City Schools will likely have to pay back around $700,000 in money it had been allocated. Douglas said that equals out to the salary for about 10 teachers. However, he told News 19 that the school system will not handle the situation by laying off teachers. 'Thankfully, we've been great stewards of our money, we're going to protect the classrooms, but we'll have to pass a deficit budget,' he said. Hexcel is a carbon fiber manufacturing company that operates a plant in Decatur. According to court documents, Hexcel claims 'economic obsolescence of 50% should be applied because of COVID-19.' Basically, Hexcel believes it was taxed at a higher rate than what the plant was valued at that time. While Hexcel and the Department of Revenue have agreed to the settlement, Douglas said he's concerned that this might start a trend for other industry companies in the area. He noted a similar recent situation with Indorama. 'When does this end?' he said. 'I've got 50 industries up and down the river that can just arbitrarily 'Hey, tough times, obsolescence, we overpaid our taxes, we want our money back.'' Douglas said Decatur City Schools is working on taking legal action. He said DCS wasn't even aware of the lawsuit until April of this year. Douglas also questioned why it was impacted as a result of the settlement agreement, when it played no role in the legal proceedings. 'We were told it's pretty much their decision what they settle for, and I'm like, if I'm paying half the money back, shouldn't I get a seat at the table?' Douglas told News 19. He said several other entities would also be required to pay money back, including Morgan County Schools and Hartselle City Schools. A spokesperson for Hexcel sent News 19 the following statement regarding the settlement. 'Hexcel is pleased to have reached an amicable settlement with Morgan County on this longstanding issue related to past personal property tax assessments at our Decatur facility. Hexcel has no comment on how Morgan County decides to allocate the impact of the settlement.' Matthew Bates, Hexcel Spokesperson News 19 also reached out to the Morgan County Department of Revenue's office for comment. At this time, our phone call has not been returned. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
11-05-2025
- Business
- Yahoo
HXL Q1 Earnings Call: Guidance Cut as Commercial Aerospace Demand Softens
Aerospace and defense company Hexcel (NYSE:HXL) missed Wall Street's revenue expectations in Q1 CY2025, with sales falling 3.3% year on year to $456.5 million. The company's full-year revenue guidance of $1.92 billion at the midpoint came in 3.4% below analysts' estimates. Its non-GAAP profit of $0.37 per share was 12.4% below analysts' consensus estimates. Is now the time to buy HXL? Find out in our full research report (it's free). Revenue: $456.5 million vs analyst estimates of $472.4 million (3.3% year-on-year decline, 3.4% miss) Adjusted EPS: $0.37 vs analyst expectations of $0.42 (12.4% miss) Adjusted EBITDA: $75.1 million vs analyst estimates of $88.98 million (16.5% margin, 15.6% miss) The company dropped its revenue guidance for the full year to $1.92 billion at the midpoint from $2 billion, a 4.3% decrease Management lowered its full-year Adjusted EPS guidance to $1.95 at the midpoint, a 9.3% decrease Operating Margin: 9.7%, down from 11.2% in the same quarter last year Free Cash Flow was -$54.6 million compared to -$35.7 million in the same quarter last year Market Capitalization: $4.15 billion Hexcel's first quarter results were impacted by lower than expected demand from key commercial aerospace customers, especially Airbus and Boeing, leading to reduced sales and margins. Management cited delays in production rate increases for major aircraft programs, particularly the Airbus A350 and Boeing 787, as the main reasons behind the revenue decline. CEO Tom Gentile noted that '2025 is turning out to be another year in which production rate increases for commercial aircraft will not meet initial expectations due to ongoing supply chain disruption.' For the remainder of the year, Hexcel's guidance reflects a more cautious outlook, with significant reductions in both expected revenue and adjusted EPS. The company attributed this to revised demand forecasts from major customers, especially Airbus, and ongoing uncertainties tied to tariffs and supply chain issues. Management emphasized ongoing cost control and operational efficiency as priorities, with Gentile stating, 'We are pivoting and managing the business for the realities of today.' Management discussed several operational and market factors that shaped first quarter results and the company's outlook for the year. Airbus A350 Production Cuts: Lower demand for A350 materials was the main driver of reduced sales, as Airbus revised its production forecast for 2025, resulting in Hexcel planning to deliver 68 shipsets instead of the previously anticipated 84. Defense & Space Growth: The defense and space segment saw modest year-over-year growth, with increased sales to U.S. and European military programs such as the CH-53K and Blackhawk helicopters, as well as classified and space contracts. Operational Disruptions: A power outage at the Decatur, Alabama facility disrupted carbon fiber precursor production, leading to extra costs and contributing to lower margins in the quarter. The plant has since resumed normal operations. Cost Control Measures: Hexcel maintained a reduced headcount, running about 300 staff below plan, and is deferring capital expenditures across multiple projects. Management stressed a focus on operational efficiency through Lean and Six Sigma initiatives. Minimal Direct Tariff Exposure: Management indicated that only about 1% of procurement is from countries newly targeted by tariffs, suggesting limited direct exposure, but acknowledged uncertainty about indirect effects on the broader aerospace supply chain. Looking ahead, Hexcel's guidance for the year is driven by ongoing production challenges in commercial aerospace, efforts to manage costs, and uncertainty surrounding tariffs and customer demand. Commercial Aerospace Uncertainty: Reduced build rates for programs like the Airbus A350 and A320, along with Boeing 787 delays, will limit sales growth and weigh on operating margins for the remainder of 2025. Defense Segment Stability: Management expects continued stability in defense and space demand, with opportunities for expansion as U.S. and European governments increase military spending and Hexcel leverages its vertically integrated U.S. and European operations. Tariffs and Supply Chain Risks: New U.S. tariffs are expected to have a small direct impact, but management noted that indirect effects on the aerospace supply chain could introduce additional risks to production rates and margins. Sheila Kahyaoglu (Jefferies): Asked about the direct and indirect impact of new tariffs on profitability. Management estimated direct costs of $3–4 million per quarter, mostly offsettable by productivity, but emphasized the uncertainty of broader supply chain effects. Michael Ciarmoli (Truist): Inquired about the ability to offset tariff costs through pricing. Management explained that some contracts pass costs through to buyers, especially for Europe-sourced goods, but major aerospace contracts are generally fixed-price. John McNulty (BMO Capital Markets): Questioned the more aggressive approach to headcount management and the ability to ramp up quickly when demand improves. Management stated they are aligning staffing with current production but have sufficient inventory and capital capacity to respond to future increases. Ken Herbert (RBC Capital Markets): Probed about inventory levels at Airbus and the risk of further destocking. Management believes the current plan accounts for some destocking and is confident capacity will support future production ramps. Scott Mikus (Melius Research): Asked about opportunities to reprice long-term agreements and respond to inflation. Management indicated pricing can be renegotiated upon contract expiration, but the largest program (A350) is locked until 2030, with productivity improvements as the primary adjustment mechanism. In coming quarters, the StockStory team will be monitoring (1) Airbus and Boeing production rate developments, particularly for the A350 and 787 programs; (2) whether Hexcel's cost control efforts, including reduced headcount and capital expenditures, lead to margin stabilization; and (3) progress on the divestiture of non-core assets, such as the Austria facility, which could further streamline operations. The evolution of U.S. and European defense spending and any indirect impacts from new tariffs will also be key factors. Hexcel currently trades at a forward P/E ratio of 22.7×. Should you load up, cash out, or stay put? Find out in our free research report. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. 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Yahoo
23-04-2025
- Business
- Yahoo
Is It Too Late To Consider Buying Hexcel Corporation (NYSE:HXL)?
Hexcel Corporation (NYSE:HXL), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$70.69 at one point, and dropping to the lows of US$47.49. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Hexcel's current trading price of US$48.31 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Hexcel's outlook and value based on the most recent financial data to see if there are any catalysts for a price change. Our free stock report includes 2 warning signs investors should be aware of before investing in Hexcel. Read for free now. According to our price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average, the stock price seems to be justfied. We've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 31.19x is currently trading slightly above its industry peers' ratio of 30.03x, which means if you buy Hexcel today, you'd be paying a relatively reasonable price for it. And if you believe that Hexcel should be trading at this level in the long run, then there should only be a fairly immaterial downside vs other industry peers. Is there another opportunity to buy low in the future? Since Hexcel's share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market. See our latest analysis for Hexcel Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. With profit expected to more than double over the next couple of years, the future seems bright for Hexcel. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation. Are you a shareholder? It seems like the market has already priced in HXL's positive outlook, with shares trading around industry price multiples. However, there are also other important factors which we haven't considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at HXL? Will you have enough conviction to buy should the price fluctuate below the industry PE ratio? Are you a potential investor? If you've been keeping an eye on HXL, now may not be the most advantageous time to buy, given it is trading around industry price multiples. However, the positive outlook is encouraging for HXL, which means it's worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop. If you want to dive deeper into Hexcel, you'd also look into what risks it is currently facing. At Simply Wall St, we found 2 warning signs for Hexcel and we think they deserve your attention. If you are no longer interested in Hexcel, you can use our free platform to see our list of over 50 other stocks with a high growth potential. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. Sign in to access your portfolio
