Hexcel

HXL

Company. "Hexcel is the world’s leading advanced structural materials company.... Hexcel is the largest US producer of carbon fiber; the world’s largest weaver of structural fabrics; the leading global producer of fiberglass electronic materials; the number one producer of composite materials such as honeycomb, prepregs, film adhesives and sandwich panels; and a leading manufacturer of composite parts and structures." (company website)

One of Hexcel's claims to fame is that it supplied "HexPly(R) carbon prepreg" to Trek that has used it on all of the bicycles used by Lance Armstrong in the Tour de France. (press release)

Buy. When I bought Hexcel at the end of June, it was looking very strong — until after I laid my money down. Then I immediately realized that I had paid too much. The sharp gains that had brought it to my attention came too far too fast. It was bound to consolidate. And it did.

Sell. After nursing along hope for HXL for the past two months, it finally began to move again recently, eventually getting back over what I had paid. This week was marked by a couple of days of big rises on big volumes, and when it got over $13.00 I set a trigger to sell if the price fell back to $12.90, in order to protect my profits. Yesterday sent up a yellow flag when HXL traded back and forth during the day but ended just where it started. Then today it opened just a hair higher but started downward. Toward the end of the session my trigger fired, and my shares sold.

The price of HXL is now double where it was a year ago (see sidebar), and it is quite far ahead of the moving averages. It will not surprise me to see it dip back down to at least the 50-day moving average, perhaps lower.