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Trade-Ideas LLC identified

Hexcel

(

HXL

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Hexcel as such a stock due to the following factors:

  • HXL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $33.7 million.
  • HXL has traded 144,242 shares today.
  • HXL is trading at 9.04 times the normal volume for the stock at this time of day.
  • HXL is trading at a new high 6.08% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on HXL:

TheStreet Recommends

Hexcel Corporation, together with its subsidiaries, develops, manufactures, and markets structural materials for use in commercial aerospace, space and defense, and industrial markets. The company operates through two segments, Composite Materials and Engineered Products. The stock currently has a dividend yield of 1.1%. HXL has a PE ratio of 18. Currently there are 6 analysts that rate Hexcel a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Hexcel has been 545,200 shares per day over the past 30 days. Hexcel has a market cap of $3.9 billion and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of 1.08 and a short float of 6.2% with 7.36 days to cover. Shares are down 8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Hexcel as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • HXL's revenue growth has slightly outpaced the industry average of 0.6%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The current debt-to-equity ratio, 0.57, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.27, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly increased by 170.54% to $10.30 million when compared to the same quarter last year. In addition, HEXCEL CORP has also vastly surpassed the industry average cash flow growth rate of -0.94%.
  • HEXCEL CORP's earnings per share declined by 15.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, HEXCEL CORP increased its bottom line by earning $2.44 versus $2.12 in the prior year. This year, the market expects an improvement in earnings ($2.50 versus $2.44).
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, HXL has underperformed the S&P 500 Index, declining 15.34% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it is one of the factors that makes this stock an attractive investment.

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