Goldman: Sell This Industrial Stock

Short sellers have targeted HXL stock recently

Aug 16, 2019 at 10:03 AM
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Goldman Sachs downgraded Hexcel Corporation (NYSE:HXL) to "sell" from "neutral," and cut its price target by $2 to $73 -- a discount to last night's close at $80.49. The analyst in coverage called HXL's valuation "stretched," and warned of a potential deceleration in growth.

Goldman's bear note marks the first "sell" rating for the industrial materials stock. Prior to today, five analyst maintained a "buy" rating on the shares, compared to five "hold" recommendations. Meanwhile, the average 12-month price target of $85.31 is a 6% premium to current trading levels.

Bearish sentiment has been building in other corners of Wall Street, too. Short interest on Hexcel spiked 18.7% in the two most recent reporting periods to 2.47 million shares -- the most since early February.

This steady selling pressure likely created headwinds during the stock's retreat from its July 23 record high of $85.63. This retreat was quickly contained by HXL's 50-day moving average -- a trendline being tested again today as HXL slides 2.7% to trade at $78.34. Year-to-date, the equity is up roughly 37%.

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