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TheStreet Open House
Hexcel Corp
HXL : NYSE : Industrial Goods
$39.19 1.02 | 2.67%
Today's Range: 37.38 - 39.31
Avg. Daily Volume: 913,100
10/21/14 - 2:16 PM ET

Financial Analysis


HEXCEL CORP's gross profit margin for the second quarter of its fiscal year 2014 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. HEXCEL CORP has average liquidity. Currently, the Quick Ratio is 1.22 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has increased by 11.04% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY14 Q2 FY13
Net Sales ($mil)470.1422.6
EBITDA ($mil)98.885.7
EBIT ($mil)81.171.9
Net Income ($mil)50.648.5


Balance Sheet Q2 FY14 Q2 FY13
Cash & Equiv. ($mil)43.856.7
Total Assets ($mil)1947.41695.0
Total Debt ($mil)397.8314.0
Equity ($mil)1156.21041.2


Profitability Q2 FY14 Q2 FY13
Gross Profit Margin31.2330.9
EBITDA Margin21.0120.27
Operating Margin17.2517.01
Sales Turnover0.910.95
Return on Assets10.099.95
Return on Equity16.9916.21
Debt Q2 FY14 Q2 FY13
Current Ratio2.592.93
Debt/Capital0.260.23
Interest Expense2.02.1
Interest Coverage40.5534.24


Share Data Q2 FY14 Q2 FY13
Shares outstanding (mil)96.599.5
Div / share0.00.0
EPS0.510.48
Book value / share11.9810.46
Institutional Own % n/a n/a
Avg Daily Volume914875.0730852.0

Valuation


BUY. HEXCEL CORP's P/E ratio indicates a discount compared to an average of 19.92 for the Aerospace & Defense industry and a value on par with the S&P 500 average of 18.06. To use another comparison, its price-to-book ratio of 3.19 indicates a premium versus the S&P 500 average of 2.49 and a discount versus the industry average of 4.39. The price-to-sales ratio is above the S&P 500 average and well above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, HEXCEL CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
HXL 19.60 Peers 19.92   HXL 13.58 Peers 13.52

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

HXL is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

HXL is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
HXL 15.66 Peers 18.05   HXL 1.29 Peers 1.14

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

HXL is trading at a valuation on par with its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

HXL trades at a premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
HXL 3.19 Peers 4.39   HXL 17.46 Peers 78.19

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

HXL is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, HXL is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
HXL 2.08 Peers 1.47   HXL 9.44 Peers 3.56

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

HXL is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

HXL has a sales growth rate that significantly exceeds its peers.

 

 

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