• Hexcel Corporation recently reported its third-quarter fiscal 2025 results, highlighting an 11.7% year-over-year increase in defense and space sales and announcing a US$600 million share repurchase program.

• This combination of stronger defense exposure and a large buyback authorization has drawn fresh institutional interest, reshaping perceptions of Hexcel’s future positioning within aerospace and defense materials.

• Next, we’ll examine how the defense and space segment’s momentum could influence Hexcel’s broader investment narrative and risk profile.

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To own Hexcel, you need to be comfortable backing a specialized aerospace materials supplier that is leaning harder into defense and space while carrying a rich valuation and meaningful debt. The recent third quarter print, with defense and space sales up 11.7% year over year, reinforces the idea that this segment may be the most reliable near term earnings driver, particularly as prior guidance cuts and weaker margins have put the civil aerospace side under more scrutiny. The new US$600 million buyback, following earlier repurchases and a steady dividend, signals management’s confidence and has clearly helped sentiment, given the recent share price strength despite analysts turning more cautious on earnings. That said, with profit margins compressed and the stock still expensive on earnings multiples, the buyback does not remove the core risk that future results may have to work hard to justify the current price.

However, one key risk investors should not overlook sits on the balance sheet. Hexcel’s shares have been on the rise but are still potentially undervalued by 11%. Find out what it’s worth.

The Simply Wall St Community’s two fair value estimates cluster between US$76.86 and US$94.62, underscoring how differently individual investors see Hexcel’s worth. Set against rich earnings multiples and ongoing margin pressure, this spread of views underlines why many market participants are watching how defense momentum and the new US$600 million buyback influence Hexcel’s ability to support its current share price over time.

Explore 2 other fair value estimates on Hexcel – why the stock might be worth 9% less than the current price!

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