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Hexcel (Hexcel) Altman Z-Score : 4.79 (As of Apr. 26, 2024)


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What is Hexcel Altman Z-Score?

The Altman Z-Score is a model designed to predict the likelihood of a company going bankrupt within the next two years. Created by American finance professor Edward Altman in 1968, the model is specifically designed for publicly traded manufacturing companies with assets greater than $1 million.

Good Sign:

Altman Z-score of 4.79 is strong.

Hexcel has a Altman Z-Score of 4.79, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for Hexcel's Altman Z-Score or its related term are showing as below:

HXL' s Altman Z-Score Range Over the Past 10 Years
Min: 2.99   Med: 4.41   Max: 5.47
Current: 4.79

During the past 13 years, Hexcel's highest Altman Z-Score was 5.47. The lowest was 2.99. And the median was 4.41.


Hexcel Altman Z-Score Historical Data

The historical data trend for Hexcel's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Hexcel Altman Z-Score Chart

Hexcel Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 4.42 3.36 3.65 4.30 5.14

Hexcel Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
Altman Z-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4.75 5.15 4.91 5.14 5.15

Competitive Comparison of Hexcel's Altman Z-Score

For the Aerospace & Defense subindustry, Hexcel's Altman Z-Score, along with its competitors' market caps and Altman Z-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Hexcel's Altman Z-Score Distribution in the Aerospace & Defense Industry

For the Aerospace & Defense industry and Industrials sector, Hexcel's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where Hexcel's Altman Z-Score falls into.



Hexcel Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Hexcel's Altman Z-Score for today is calculated with this formula:

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*0.1776+1.4*0.7772+3.3*0.0474+0.6*4.4846+1.0*0.6393
=4.79

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.

Trailing Twelve Months (TTM) ended in Mar. 2024:
Total Assets was $2,821 Mil.
Total Current Assets was $790 Mil.
Total Current Liabilities was $289 Mil.
Retained Earnings was $2,193 Mil.
Pre-Tax Income was 46.4 + -31.6 + 35.8 + 52.1 = $103 Mil.
Interest Expense was -6.5 + -7.6 + -7.8 + -9.2 = $-31 Mil.
Revenue was 472.3 + 457.5 + 419.5 + 454.3 = $1,804 Mil.
Market Cap (Today) was $5,333 Mil.
Total Liabilities was $1,189 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(789.7 - 288.6)/2821.2
=0.1776

X2=Retained Earnings/Total Assets
=2192.6/2821.2
=0.7772

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(102.7 - -31.1)/2821.2
=0.0474

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=5332.617/1189.1
=4.4846

X5=Revenue/Total Assets
=1803.6/2821.2
=0.6393

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

Hexcel has a Altman Z-Score of 4.79 indicating it is in Safe Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


Hexcel  (NYSE:HXL) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


Hexcel Altman Z-Score Related Terms

Thank you for viewing the detailed overview of Hexcel's Altman Z-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Hexcel (Hexcel) Business Description

Traded in Other Exchanges
Address
281 Tresser Boulevard, Two Stamford Plaza, 16th Floor, Stamford, CT, USA, 06901
Founded in 1948, Hexcel designs and manufactures a range of high-performance composite fibers, fabrics, resins, and structures for use in commercial aerospace, defense, and other industrial markets. These are engineered to be lighter than metal and perform under rigorous conditions in aircraft frames, wings, engines, and other components and subassemblies. The company's name derives from the six-sided honeycomb structures that lend many of its products their light weight and rigidity. Hexcel's biggest customers are Airbus (38% of 2022 sales) and Boeing (25% of prepandemic sales) and its respective subcontractors.
Executives
Gail E Lehman officer: See Remarks 801 CRESCENT CENTRE DRIVE, SUITE 600, FRANKLIN TN 37067
Marilyn Minus director C/O NORTHEASTERN UNIVERSITY, 360 HUNTINGTON AVENUE, MIE DEPT., 334SN, BOSTON MA 2115-5000
Thierry Merlot officer: See Remarks C/O HEXCEL CORPORATION, 281 TRESSER BLVD., STAMFORD CT 06901--326
Philippe Chevrier officer: See Remarks C/O HEXCEL CORPORATION, TWO STAMFORD PLAZA, 281 TRESSER BLVD., STAMFORD CT 06901
Gina Fitzsimons officer: See Remarks C/O HEXCEL CORPORATION, TWO STAMFORD PLAZA, 281 TRESSER BLVD., STAMFORD CT 06901
Robert George Hennemuth officer: See Remarks C/O HEXCEL CORPORATION, 281 TRESSER BLVD. 16TH FLOOR, STAMFORD CT 06901
Nick L Stanage officer: President 20807 DECATUR STREET, CASSOPOLIS MI 49031
Amy S Evans officer: See Remarks 2701 SPRUCE STREET, QUINCY IL 62301
Kimberly A. Hendricks officer: SVP, Corp. Controller & CAO 521 WEST 57TH STREET, NEW YORK NY 10019
Brett Raymond Schneider officer: President - Global Fibers C/O HEXCEL CORPORATION, 281 TRESSER BLVD., 16TH FLOOR, STAMFORD CT 06901
Timothy Swords officer: President, Industrial C/O HEXCEL CORPORATION, 281 TRESSER BLVD., STAMFORD CT 06901-3261
Pritchett Colleen officer: See Remarks C/O HEXCEL CORPORATION, 281 TRESSER BLVD., 16TH FLOOR, STAMFORD CT 06901
Jeffrey A Graves director C/O C&D TECHNOLOGIES, INC., 1400 UNION MEETING RD, BLUE BELL PA 19422
Patrick Winterlich officer: See Remarks HEXCEL CORPORATION, 281 TRESSER BLVD., STAMFORD CT 06901
Guy C Hachey director 5725 DELPHI DRIVE, TROY MI 48098

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