Hexcel’s Aerospace Challenges Present Long-Term Opportunity for Patient Investors

Hexcel Corporation (HXL -0.76%), a premier supplier of advanced composite materials, finds itself in a temporary slump within the aerospace sector. The company's heavy reliance on Airbus and Boeing—accounting for 40% and 15% of 2024 sales, respectively—has left it vulnerable to production cuts. With Airbus scaling back A350 widebody expectations and no aftermarket demand cushion, Hexcel faces margin pressures and stagnant near-term growth.

Wall Street anticipates minimal sales growth and declining EPS this year. Yet beneath the surface, Hexcel's technological leadership in carbon fiber composites positions it for inevitable recovery when aerospace production rebounds. The current pessimism creates a rare entry point for investors with multi-year horizons.