LRT Capital Management, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A return of +18.39% was recorded by the LRT Economic Moat strategy year-to-date, extending its 12-month returns to +35.34%. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
LRT Capital Management, in its Q3 2021 investor letter, mentioned Hexcel Corporation (NYSE: HXL) and discussed its stance on the firm. Hexcel Corporation is a Stamford, Connecticut-based industrial materials company with a $4.4 billion market capitalization. HXL delivered a 9.80% return since the beginning of the year, while its 12-month returns are up by 2.48%. The stock closed at $53.24 per share on November 26, 2021.
Here is what LRT Capital Management has to say about Hexcel Corporation in its Q3 2021 investor letter:
“Hexcel manufactures carbon fiber composite materials with the primary end markets being aerospace and defense. The company’s stock price was hit heavily last year due to the decline in the aerospace market, but the stock is making an impressive comeback this year as the outlook for travel and aerospace demand improves. The near-term demand for lightweight, high-performance carbon fiber composites is still uncertain, but the longer-term trend is clearly very strong. As airplane manufacturers look to improve the fuel efficiency and performance of their planes, the primary way of doing this is to reduce weight. The 787, 777X and A350 are just the most recent examples of planes from Boeing and Airbus that utilize an increasing amount of carbon fiber materials in their construction.
Hexcel reported a profit of $0.08 per share for Q2 2021, while revenue declined 15% year-over-year.56 Just as is the case with Marriott, we do not view these results as meaningful or indicative of a long-term trend, but rather a once in a century aberration due to the Covid-19 pandemic. Once Covid-19 recedes, we expect the demand for more fuel-efficient planes to return rather quickly, powering the demand for the company’s light weight carbon composites. Shares are +28.23% year-to-date and +67.38% over the past twelve months.”
Photo by Pranav Kumar Jain on Unsplash
Based on our calculations, Hexcel Corporation (NYSE: HXL) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. HXL was in 21 hedge fund portfolios at the end of the third quarter of 2021, compared to 22 funds in the previous quarter. Hexcel Corporation (NYSE: HXL) delivered a -5.38% return in the past 3 months.
Disclosure: None. This article is originally published at Insider Monkey.
