Hexcel (HXL) Stock Forecast & Price Target

Hexcel is poised for positive financial performance, highlighted by an anticipated 50% growth in WB revenues between 2026 and 2028, driven by investor confidence in the original equipment cycle. The company's Defense, Space & Other segment experienced a year-over-year sales increase of 13.3%, reaching $182 million, exceeding consensus expectations by 11%, along with a notable growth in free cash flow of approximately $96.5 million, marking a 32% increase year-over-year. Additionally, ongoing enhancements such as the expansion of the A320 program and increased defense spending in Europe signal strong future demand, supporting the outlook for sustained earnings and cash flow growth as supply chains stabilize.

Hexcel's stock forecast is under pressure due to several key financial metrics reflecting operational challenges; specifically, commercial aerospace sales saw an 8.6% year-over-year decline to $293 million, accompanied by a drop in operating margins, which fell 260 basis points to 11.2%. The company's gross margins have also been adversely affected by tariffs and reduced inventory levels, contributing to a decline in adjusted operating margins to 9.8%, down 180 basis points year-over-year. Furthermore, the downward revision of earnings per share guidance by approximately $0.20 primarily accounts for these tariff impacts alongside rising interest expenses and ongoing destocking pressures, indicating potential further financial strain.