ILLINOIS TOOL WORKS (ITW) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:ITW • US4523081093
298.07 USD
+3.82 (+1.3%)
At close: Feb 11, 2026
298.07 USD
0 (0%)
After Hours: 2/11/2026, 8:04:00 PM
Overall ITW gets a fundamental rating of 6 out of 10. We evaluated ITW against 131 industry peers in the Machinery industry. While ITW belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ITW is valied quite expensively at the moment, while it does show a decent growth rate. Finally ITW also has an excellent dividend rating. These ratings would make ITW suitable for dividend investing!
1. Profitability
1.1 Basic Checks
- In the past year ITW was profitable.
- ITW had a positive operating cash flow in the past year.
- Each year in the past 5 years ITW has been profitable.
- ITW had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- ITW has a Return On Assets of 18.75%. This is amongst the best in the industry. ITW outperforms 97.71% of its industry peers.
- With an excellent Return On Equity value of 94.33%, ITW belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- ITW's Return On Invested Capital of 24.43% is amongst the best of the industry. ITW outperforms 97.71% of its industry peers.
- ITW had an Average Return On Invested Capital over the past 3 years of 28.88%. This is significantly above the industry average of 10.21%.
- The last Return On Invested Capital (24.43%) for ITW is well below the 3 year average (28.88%), which needs to be investigated, but indicates that ITW had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.75% | ||
| ROE | 94.33% | ||
| ROIC | 24.43% |
ROA(3y)20.4%
ROA(5y)19.52%
ROE(3y)99.48%
ROE(5y)94.2%
ROIC(3y)28.88%
ROIC(5y)26.49%
1.3 Margins
- ITW has a Profit Margin of 19.05%. This is amongst the best in the industry. ITW outperforms 96.18% of its industry peers.
- ITW's Profit Margin has improved in the last couple of years.
- With an excellent Operating Margin value of 26.20%, ITW belongs to the best of the industry, outperforming 98.47% of the companies in the same industry.
- ITW's Operating Margin has improved in the last couple of years.
- ITW's Gross Margin of 43.93% is amongst the best of the industry. ITW outperforms 83.21% of its industry peers.
- ITW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.2% | ||
| PM (TTM) | 19.05% | ||
| GM | 43.93% |
OM growth 3Y3.37%
OM growth 5Y2.77%
PM growth 3Y0.12%
PM growth 5Y2.64%
GM growth 3Y2.61%
GM growth 5Y1.3%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ITW is creating value.
- Compared to 1 year ago, ITW has less shares outstanding
- ITW has less shares outstanding than it did 5 years ago.
- ITW has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 8.60 indicates that ITW is not in any danger for bankruptcy at the moment.
- ITW's Altman-Z score of 8.60 is amongst the best of the industry. ITW outperforms 91.60% of its industry peers.
- ITW has a debt to FCF ratio of 3.14. This is a good value and a sign of high solvency as ITW would need 3.14 years to pay back of all of its debts.
- With a decent Debt to FCF ratio value of 3.14, ITW is doing good in the industry, outperforming 67.94% of the companies in the same industry.
- A Debt/Equity ratio of 2.80 is on the high side and indicates that ITW has dependencies on debt financing.
- ITW has a worse Debt to Equity ratio (2.80) than 86.26% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.8 | ||
| Debt/FCF | 3.14 | ||
| Altman-Z | 8.6 |
ROIC/WACC2.62
WACC9.32%
2.3 Liquidity
- ITW has a Current Ratio of 1.53. This is a normal value and indicates that ITW is financially healthy and should not expect problems in meeting its short term obligations.
- ITW has a worse Current ratio (1.53) than 72.52% of its industry peers.
- ITW has a Quick Ratio of 1.11. This is a normal value and indicates that ITW is financially healthy and should not expect problems in meeting its short term obligations.
- ITW's Quick ratio of 1.11 is in line compared to the rest of the industry. ITW outperforms 42.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.53 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
- ITW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.15%.
- Measured over the past years, ITW shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.61% on average per year.
- The Revenue has been growing slightly by 0.92% in the past year.
- ITW shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.99% yearly.
EPS 1Y (TTM)3.15%
EPS 3Y2.36%
EPS 5Y9.61%
EPS Q2Q%7.09%
Revenue 1Y (TTM)0.92%
Revenue growth 3Y0.23%
Revenue growth 5Y4.99%
Sales Q2Q%4.09%
3.2 Future
- Based on estimates for the next years, ITW will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.86% on average per year.
- The Revenue is expected to grow by 4.41% on average over the next years.
EPS Next Y8.41%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
EPS Next 5Y8.86%
Revenue Next Year3.33%
Revenue Next 2Y3.36%
Revenue Next 3Y3.89%
Revenue Next 5Y4.41%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 28.41, the valuation of ITW can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of ITW is on the same level as its industry peers.
- ITW's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.18.
- With a Price/Forward Earnings ratio of 26.21, ITW can be considered very expensive at the moment.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ITW is on the same level as its industry peers.
- Compared to an average S&P500 Price/Forward Earnings ratio of 28.01, ITW is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.41 | ||
| Fwd PE | 26.21 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as ITW.
- The rest of the industry has a similar Price/Free Cash Flow ratio as ITW.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.39 | ||
| EV/EBITDA | 20.44 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ITW does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of ITW may justify a higher PE ratio.
PEG (NY)3.38
PEG (5Y)2.96
EPS Next 2Y7.81%
EPS Next 3Y8.91%
5. Dividend
5.1 Amount
- ITW has a Yearly Dividend Yield of 2.16%.
- ITW's Dividend Yield is rather good when compared to the industry average which is at 1.14. ITW pays more dividend than 89.31% of the companies in the same industry.
- ITW's Dividend Yield is a higher than the S&P500 average which is at 1.80.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.16% |
5.2 History
- The dividend of ITW is nicely growing with an annual growth rate of 6.98%!
- ITW has been paying a dividend for at least 10 years, so it has a reliable track record.
- ITW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.98%
Div Incr Years29
Div Non Decr Years29
5.3 Sustainability
- ITW pays out 58.20% of its income as dividend. This is a bit on the high side, but may be sustainable.
- The dividend of ITW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP58.2%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
298.07
+3.82 (+1.3%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-03 2026-02-03/bmo
Earnings (Next)04-28 2026-04-28/bmo
Inst Owners84.97%
Inst Owner Change-1.6%
Ins Owners0.24%
Ins Owner Change-8.5%
Market Cap86.47B
Revenue(TTM)16.04B
Net Income(TTM)3.03B
Analysts52.31
Price Target264.95 (-11.11%)
Short Float %2.66%
Short Ratio6.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.16% |
Yearly Dividend5.71
Dividend Growth(5Y)6.98%
DP58.2%
Div Incr Years29
Div Non Decr Years29
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.08%
Min EPS beat(2)-0.33%
Max EPS beat(2)2.48%
EPS beat(4)3
Avg EPS beat(4)0.83%
Min EPS beat(4)-0.33%
Max EPS beat(4)2.48%
EPS beat(8)6
Avg EPS beat(8)1.3%
EPS beat(12)10
Avg EPS beat(12)2.72%
EPS beat(16)14
Avg EPS beat(16)2.82%
Revenue beat(2)0
Avg Revenue beat(2)-0.94%
Min Revenue beat(2)-1.6%
Max Revenue beat(2)-0.27%
Revenue beat(4)0
Avg Revenue beat(4)-1.32%
Min Revenue beat(4)-2.36%
Max Revenue beat(4)-0.27%
Revenue beat(8)0
Avg Revenue beat(8)-1.71%
Revenue beat(12)1
Avg Revenue beat(12)-1.46%
Revenue beat(16)5
Avg Revenue beat(16)-0.55%
PT rev (1m)1.3%
PT rev (3m)1.27%
EPS NQ rev (1m)-0.08%
EPS NQ rev (3m)-0.13%
EPS NY rev (1m)0.06%
EPS NY rev (3m)-0.02%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-0.05%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-0.05%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.41 | ||
| Fwd PE | 26.21 | ||
| P/S | 5.44 | ||
| P/FCF | 30.39 | ||
| P/OCF | 26.39 | ||
| P/B | 26.95 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.44 |
EPS(TTM)10.49
EY3.52%
EPS(NY)11.37
Fwd EY3.82%
FCF(TTM)9.81
FCFY3.29%
OCF(TTM)11.3
OCFY3.79%
SpS54.75
BVpS11.06
TBVpS-8.14
PEG (NY)3.38
PEG (5Y)2.96
Graham Number51.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.75% | ||
| ROE | 94.33% | ||
| ROCE | 34.67% | ||
| ROIC | 24.43% | ||
| ROICexc | 26.26% | ||
| ROICexgc | 47.72% | ||
| OM | 26.2% | ||
| PM (TTM) | 19.05% | ||
| GM | 43.93% | ||
| FCFM | 17.91% |
ROA(3y)20.4%
ROA(5y)19.52%
ROE(3y)99.48%
ROE(5y)94.2%
ROIC(3y)28.88%
ROIC(5y)26.49%
ROICexc(3y)31.54%
ROICexc(5y)28.97%
ROICexgc(3y)68.5%
ROICexgc(5y)61.67%
ROCE(3y)38.38%
ROCE(5y)35.46%
ROICexgc growth 3Y12.09%
ROICexgc growth 5Y10.24%
ROICexc growth 3Y7.34%
ROICexc growth 5Y8.51%
OM growth 3Y3.37%
OM growth 5Y2.77%
PM growth 3Y0.12%
PM growth 5Y2.64%
GM growth 3Y2.61%
GM growth 5Y1.3%
F-Score6
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.8 | ||
| Debt/FCF | 3.14 | ||
| Debt/EBITDA | 1.97 | ||
| Cap/Depr | 109.09% | ||
| Cap/Sales | 2.72% | ||
| Interest Coverage | 15.13 | ||
| Cash Conversion | 71.9% | ||
| Profit Quality | 94.02% | ||
| Current Ratio | 1.53 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 8.6 |
F-Score6
WACC9.32%
ROIC/WACC2.62
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)3.15%
EPS 3Y2.36%
EPS 5Y9.61%
EPS Q2Q%7.09%
EPS Next Y8.41%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
EPS Next 5Y8.86%
Revenue 1Y (TTM)0.92%
Revenue growth 3Y0.23%
Revenue growth 5Y4.99%
Sales Q2Q%4.09%
Revenue Next Year3.33%
Revenue Next 2Y3.36%
Revenue Next 3Y3.89%
Revenue Next 5Y4.41%
EBIT growth 1Y-1.4%
EBIT growth 3Y3.61%
EBIT growth 5Y7.9%
EBIT Next Year15.58%
EBIT Next 3Y8.5%
EBIT Next 5Y7.1%
FCF growth 1Y3.23%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y2.21%
OCF growth 3YN/A
OCF growth 5YN/A
ILLINOIS TOOL WORKS / ITW FAQ
What is the ChartMill fundamental rating of ILLINOIS TOOL WORKS (ITW) stock?
ChartMill assigns a fundamental rating of 6 / 10 to ITW.
Can you provide the valuation status for ILLINOIS TOOL WORKS?
ChartMill assigns a valuation rating of 3 / 10 to ILLINOIS TOOL WORKS (ITW). This can be considered as Overvalued.
How profitable is ILLINOIS TOOL WORKS (ITW) stock?
ILLINOIS TOOL WORKS (ITW) has a profitability rating of 9 / 10.
What is the valuation of ILLINOIS TOOL WORKS based on its PE and PB ratios?
The Price/Earnings (PE) ratio for ILLINOIS TOOL WORKS (ITW) is 28.41 and the Price/Book (PB) ratio is 26.95.
Is the dividend of ILLINOIS TOOL WORKS sustainable?
The dividend rating of ILLINOIS TOOL WORKS (ITW) is 8 / 10 and the dividend payout ratio is 58.2%.