TEXTRON INC (TXT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TXT - US8832031012 - Common Stock
90.22 USD
-0.65 (-0.72%)
89.2289 USD
-0.99 (-1.1%)
Overall TXT gets a fundamental rating of 5 out of 10. We evaluated TXT against 71 industry peers in the Aerospace & Defense industry. TXT has an average financial health and profitability rating. TXT is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year TXT was profitable.
In the past year TXT had a positive cash flow from operations.
In the past 5 years TXT has always been profitable.
TXT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
TXT has a better Return On Assets (4.76%) than 66.20% of its industry peers.
Looking at the Return On Equity, with a value of 11.04%, TXT is in the better half of the industry, outperforming 70.42% of the companies in the same industry.
TXT has a Return On Invested Capital (6.29%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for TXT is below the industry average of 8.60%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.76% | ||
| ROE | 11.04% | ||
| ROIC | 6.29% |
ROA(3y)5.21%
ROA(5y)4.47%
ROE(3y)12.24%
ROE(5y)10.59%
ROIC(3y)6.46%
ROIC(5y)5.77%
1.3 Margins
TXT has a Profit Margin of 5.81%. This is in the better half of the industry: TXT outperforms 60.56% of its industry peers.
TXT's Profit Margin has been stable in the last couple of years.
With a Operating Margin value of 6.57%, TXT perfoms like the industry average, outperforming 47.89% of the companies in the same industry.
TXT's Operating Margin has declined in the last couple of years.
TXT has a Gross Margin of 20.62%. This is in the lower half of the industry: TXT underperforms 61.97% of its industry peers.
In the last couple of years the Gross Margin of TXT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.57% | ||
| PM (TTM) | 5.81% | ||
| GM | 20.62% |
OM growth 3Y-2.25%
OM growth 5Y-3.69%
PM growth 3Y-0.06%
PM growth 5Y0.11%
GM growth 3Y3.26%
GM growth 5Y2.58%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TXT is destroying value.
The number of shares outstanding for TXT has been reduced compared to 1 year ago.
The number of shares outstanding for TXT has been reduced compared to 5 years ago.
The debt/assets ratio for TXT has been reduced compared to a year ago.
2.2 Solvency
TXT has an Altman-Z score of 2.70. This is not the best score and indicates that TXT is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.70, TXT is doing worse than 64.79% of the companies in the same industry.
The Debt to FCF ratio of TXT is 5.37, which is a neutral value as it means it would take TXT, 5.37 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 5.37, TXT is doing good in the industry, outperforming 69.01% of the companies in the same industry.
TXT has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
TXT has a Debt to Equity ratio of 0.45. This is comparable to the rest of the industry: TXT outperforms 50.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 5.37 | ||
| Altman-Z | 2.7 |
ROIC/WACC0.67
WACC9.37%
2.3 Liquidity
A Current Ratio of 1.71 indicates that TXT should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.71, TXT is doing worse than 67.61% of the companies in the same industry.
TXT has a Quick Ratio of 1.71. This is a bad value and indicates that TXT is not financially healthy enough and could expect problems in meeting its short term obligations.
TXT has a Quick ratio of 0.73. This is amonst the worse of the industry: TXT underperforms 85.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.71 | ||
| Quick Ratio | 0.73 |
3. Growth
3.1 Past
TXT shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.35%.
Measured over the past 5 years, TXT shows a small growth in Earnings Per Share. The EPS has been growing by 7.88% on average per year.
The Revenue has been growing slightly by 1.83% in the past year.
TXT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.11% yearly.
EPS 1Y (TTM)-0.35%
EPS 3Y18.42%
EPS 5Y7.88%
EPS Q2Q%10.71%
Revenue 1Y (TTM)1.83%
Revenue growth 3Y3.43%
Revenue growth 5Y0.11%
Sales Q2Q%5.11%
3.2 Future
The Earnings Per Share is expected to grow by 11.64% on average over the next years. This is quite good.
The Revenue is expected to grow by 3.87% on average over the next years.
EPS Next Y12.65%
EPS Next 2Y12.4%
EPS Next 3Y11.97%
EPS Next 5Y11.64%
Revenue Next Year6.19%
Revenue Next 2Y5.57%
Revenue Next 3Y4.9%
Revenue Next 5Y3.87%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 15.77, the valuation of TXT can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of TXT indicates a rather cheap valuation: TXT is cheaper than 98.59% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of TXT to the average of the S&P500 Index (26.57), we can say TXT is valued slightly cheaper.
TXT is valuated correctly with a Price/Forward Earnings ratio of 13.03.
TXT's Price/Forward Earnings ratio is rather cheap when compared to the industry. TXT is cheaper than 97.18% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TXT to the average of the S&P500 Index (24.04), we can say TXT is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.77 | ||
| Fwd PE | 13.03 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TXT indicates a rather cheap valuation: TXT is cheaper than 92.96% of the companies listed in the same industry.
95.77% of the companies in the same industry are more expensive than TXT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.88 | ||
| EV/EBITDA | 13.73 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.25
PEG (5Y)2
EPS Next 2Y12.4%
EPS Next 3Y11.97%
5. Dividend
5.1 Amount
With a yearly dividend of 0.09%, TXT is not a good candidate for dividend investing.
TXT's Dividend Yield is a higher than the industry average which is at 0.41.
With a Dividend Yield of 0.09, TXT pays less dividend than the S&P500 average, which is at 1.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
5.2 History
The dividend of TXT decreases each year by -4.65%.
TXT has paid a dividend for at least 10 years, which is a reliable track record.
TXT has decreased its dividend recently.
Dividend Growth(5Y)-4.65%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
TXT pays out 1.81% of its income as dividend. This is a sustainable payout ratio.
DP1.81%
EPS Next 2Y12.4%
EPS Next 3Y11.97%
90.22
-0.65 (-0.72%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners88.32%
Inst Owner Change-1.97%
Ins Owners0.52%
Ins Owner Change-0.05%
Market Cap15.90B
Revenue(TTM)14.24B
Net Income(TTM)827.00M
Analysts74
Price TargetN/A
Short Float %2.22%
Short Ratio2.84
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
Yearly Dividend0.06
Dividend Growth(5Y)-4.65%
DP1.81%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.04%
Min EPS beat(2)5.65%
Max EPS beat(2)6.44%
EPS beat(4)3
Avg EPS beat(4)6.16%
Min EPS beat(4)-0.14%
Max EPS beat(4)12.71%
EPS beat(8)5
Avg EPS beat(8)2.55%
EPS beat(12)8
Avg EPS beat(12)4.67%
EPS beat(16)11
Avg EPS beat(16)6.11%
Revenue beat(2)1
Avg Revenue beat(2)-1.26%
Min Revenue beat(2)-3.66%
Max Revenue beat(2)1.14%
Revenue beat(4)2
Avg Revenue beat(4)-1.97%
Min Revenue beat(4)-6.11%
Max Revenue beat(4)1.14%
Revenue beat(8)2
Avg Revenue beat(8)-2.64%
Revenue beat(12)2
Avg Revenue beat(12)-2.56%
Revenue beat(16)3
Avg Revenue beat(16)-2.73%
PT rev (1m)0.08%
PT rev (3m)-1.17%
EPS NQ rev (1m)0.3%
EPS NQ rev (3m)-5.35%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.07%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)-0.69%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.77 | ||
| Fwd PE | 13.03 | ||
| P/S | 1.12 | ||
| P/FCF | 22.88 | ||
| P/OCF | 15.03 | ||
| P/B | 2.12 | ||
| P/tB | 3.07 | ||
| EV/EBITDA | 13.73 |
EPS(TTM)5.72
EY6.34%
EPS(NY)6.92
Fwd EY7.67%
FCF(TTM)3.94
FCFY4.37%
OCF(TTM)6
OCFY6.65%
SpS80.79
BVpS42.52
TBVpS29.35
PEG (NY)1.25
PEG (5Y)2
Graham Number73.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.76% | ||
| ROE | 11.04% | ||
| ROCE | 7.3% | ||
| ROIC | 6.29% | ||
| ROICexc | 7.14% | ||
| ROICexgc | 8.99% | ||
| OM | 6.57% | ||
| PM (TTM) | 5.81% | ||
| GM | 20.62% | ||
| FCFM | 4.88% |
ROA(3y)5.21%
ROA(5y)4.47%
ROE(3y)12.24%
ROE(5y)10.59%
ROIC(3y)6.46%
ROIC(5y)5.77%
ROICexc(3y)7.59%
ROICexc(5y)6.85%
ROICexgc(3y)9.98%
ROICexgc(5y)9.07%
ROCE(3y)7.5%
ROCE(5y)6.7%
ROICexgc growth 3Y-0.61%
ROICexgc growth 5Y-6.86%
ROICexc growth 3Y-0.39%
ROICexc growth 5Y-5.86%
OM growth 3Y-2.25%
OM growth 5Y-3.69%
PM growth 3Y-0.06%
PM growth 5Y0.11%
GM growth 3Y3.26%
GM growth 5Y2.58%
F-Score7
Asset Turnover0.82
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 5.37 | ||
| Debt/EBITDA | 2.55 | ||
| Cap/Depr | 92.6% | ||
| Cap/Sales | 2.55% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.73% | ||
| Profit Quality | 84.04% | ||
| Current Ratio | 1.71 | ||
| Quick Ratio | 0.73 | ||
| Altman-Z | 2.7 |
F-Score7
WACC9.37%
ROIC/WACC0.67
Cap/Depr(3y)95.41%
Cap/Depr(5y)92.69%
Cap/Sales(3y)2.78%
Cap/Sales(5y)2.82%
Profit Quality(3y)101.47%
Profit Quality(5y)122.86%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.35%
EPS 3Y18.42%
EPS 5Y7.88%
EPS Q2Q%10.71%
EPS Next Y12.65%
EPS Next 2Y12.4%
EPS Next 3Y11.97%
EPS Next 5Y11.64%
Revenue 1Y (TTM)1.83%
Revenue growth 3Y3.43%
Revenue growth 5Y0.11%
Sales Q2Q%5.11%
Revenue Next Year6.19%
Revenue Next 2Y5.57%
Revenue Next 3Y4.9%
Revenue Next 5Y3.87%
EBIT growth 1Y-8.24%
EBIT growth 3Y1.11%
EBIT growth 5Y-3.59%
EBIT Next Year50.04%
EBIT Next 3Y19.62%
EBIT Next 5Y12.03%
FCF growth 1Y-19%
FCF growth 3Y-19%
FCF growth 5Y-0.75%
OCF growth 1Y-14.95%
OCF growth 3Y-14.07%
OCF growth 5Y0%
TEXTRON INC / TXT FAQ
Can you provide the ChartMill fundamental rating for TEXTRON INC?
ChartMill assigns a fundamental rating of 5 / 10 to TXT.
What is the valuation status for TXT stock?
ChartMill assigns a valuation rating of 6 / 10 to TEXTRON INC (TXT). This can be considered as Fairly Valued.
Can you provide the profitability details for TEXTRON INC?
TEXTRON INC (TXT) has a profitability rating of 5 / 10.
How financially healthy is TEXTRON INC?
The financial health rating of TEXTRON INC (TXT) is 4 / 10.
What is the earnings growth outlook for TEXTRON INC?
The Earnings per Share (EPS) of TEXTRON INC (TXT) is expected to grow by 12.65% in the next year.