Advanced composites provider Hexcel (HXL -0.03%), work process technology company Trimble (TRMB 1.59%), and sensing and power solutions company ON Semiconductor (ON 2.53%) are companies going places. They all offer unique investment propositions for long-term investors. Here's why all three are attractive stocks to buy.

Hexcel, an aerospace stock to buy 

I've covered Hexcel and its recent second-quarter results in more length elsewhere. The earnings report wasn't well received, and the stock sold off in its aftermath. However, I think the market is wrong. Hexcel raised every aspect of its full-year guidance bar except ree cash flow, but that was because of a conscious decision to buy a facility it's leasing. The market may also have worried about the sequential decline in gross margin, but it comes mainly from a solid first-quarter margin. 

Longer term, its key customers Boeing and Airbus continue to ramp up airplane production, and Boeing's CEO Dave Calhoun believes composites will play a significant role in the next plane Boeing develops, as well as newer airplanes such as the Airbus A220-500 and larger business jets. 

What makes Hexcel unique in the aerospace sector is that its growth prospects depend on cyclical and secular growth. In other words, a combination of long-term airplane production plus growing penetration of composite technology in airplanes (which offers a strength and weight advantage over traditional materials). Both are likely given multiyear backlogs at Boeing and Airbus due to the increasing need to improve airplane range and efficiency. 

Trimble's underlying growth continues

The positioning technology company Trimble's uniqueness comes from shifting its solutions purpose in line with its customers' needs -- and how this shift is reflected in its profit margins and annualized recurring revenue. 

The company's origins lie in hardware that helps customers across various industries with precise positioning needs, such as geospatial mapping or precise points on a construction project. However, Trimble's relevance has evolved to merely providing positioning and sensing technology. Given the mass of digital data its customers produce using Trimble technology, there's a huge growth opportunity to model customers' workflow and ultimately analyze and optimize it.

Examples include using precision agriculture to help farmers maximize the profitability of a harvest by guiding and monitoring their work, monitoring construction projects to reduce waste and ensure timely completion, and continuously monitoring and updating optimal routes on a transportation fleet. The critical point is Trimble is becoming an integral part of its customers' daily workflow. 

As such, Trimble is growing its share of higher-margin software revenue and its annualized recurring revenue (ARR) at a mid-teens rate. Customers are more willing to subscribe to its services if the company's solutions are integrated into their continuous activity. 

These factors are amply illustrated in the recent second-quarter results and guidance, where non-GAAP gross margin expanded to 64.2% from 59.7% in the same quarter of last year, and ARR grew 14% year over year on an organic basis. Management expects "mid-teens" organic ARR growth for the full year.

The ARR will ultimately drop into free-cash-flow growth in the future, meaning it's an outstanding stock for long-term investors. 

ON Semiconductor, growth in the right markets

ON Semiconductor's uniqueness comes from the critical end markets its management targets for its growth. For good reason, semiconductor companies are often seen as plays on consumer discretionary spending. The cyclicality of consumer electronics (PCs, smartphones, tablets, etc.) has long been the swing factor in semiconductor companies' earnings prospects. 

Indeed, ON Semiconductor (a company that operates under the Onsemi brand) has around 32% of its revenue from end markets including graphics cards, computers, smartphones,  etc. -- lumped together under its "other" end markets. 

However, ON Semiconductor is a bit different. Its future lies in automotive and industrial end markets, where it has many growth opportunities due to its exposure to electric vehicles, advanced driver assistance systems, industrial automation, machine vision, robotics, smart cities/buildings, and other growth industries. 

Just as with Hexcel, ON Semiconductor's management believes it has a significant growth opportunity coming from end-market growth in these industries and increasing its content within products in these industries. These trends are manifest in the company's second-quarter sales performance. While overall sales were flat year over year, the company's automotive sales rose 35% year over year, and its industrial sales increased 5% year over year. Meanwhile, ON Semiconductor continues to exit non-core markets.

Thinking longer term, management believes its automotive-related sales will grow at a compound annual growth rate (CAGR) of 19% from 2022-2027, with industrial sales up 10% on the same basis, leading to an overall CAGR of 10%-12% for the company.

If these targets are achieved, then the company is headed for substantive growth in earnings and cash flow in the coming years.