On Tuesday, BMO Capital Markets sustained its Market Perform rating and a $70.00 price target for Hexcel Corp . (NYSE: NYSE:HXL), a structural materials company. The firm's decision follows Hexcel's recent financial performance report, which revealed sales growth that met analysts' expectations. However, the company's operating income (OI) margins fell short, with earnings per share (EPS) surpassing forecasts due solely to tax benefits.
Hexcel's financial outcomes were impacted by ongoing supply chain difficulties and the Boeing (NYSE:BA) strike, leading the company to lower its fiscal year 2024 (FY24) outlook to the lower end of its previously stated range. The fourth quarter is also expected to perform slightly below consensus. Additionally, Hexcel has withdrawn its intermediate-term guidance for 2026, reflecting the persistent challenges in the supply chain and production within its industry.
The BMO analyst noted that despite Hexcel's efforts, it continues to face obstacles that are largely beyond its control. The company's struggles are a direct result of the broader supply chain and production issues that are affecting the industry it operates in. This situation has prompted BMO Capital to maintain its Market Perform rating on the company's shares.
Hexcel's revised FY24 forecast and the retraction of its 2026 guidance indicate that the company is adjusting its expectations in light of the external challenges it faces. The company is actively dealing with factors such as the Boeing strike and broader supply chain disruptions that have a significant impact on its operations and financial projections.
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