TEXTRON INC (TXT) Fundamental Analysis & Valuation
NYSE:TXT • US8832031012
Current stock price
88.56 USD
+0.42 (+0.48%)
Last:
This TXT fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.
1. TXT Profitability Analysis
1.1 Basic Checks
- In the past year TXT was profitable.
- TXT had a positive operating cash flow in the past year.
- TXT had positive earnings in each of the past 5 years.
- Each year in the past 5 years TXT had a positive operating cash flow.
1.2 Ratios
- TXT has a better Return On Assets (5.08%) than 65.00% of its industry peers.
- With a decent Return On Equity value of 11.70%, TXT is doing good in the industry, outperforming 68.75% of the companies in the same industry.
- TXT's Return On Invested Capital of 6.13% is in line compared to the rest of the industry. TXT outperforms 55.00% of its industry peers.
- TXT had an Average Return On Invested Capital over the past 3 years of 6.40%. This is below the industry average of 9.41%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.08% | ||
| ROE | 11.7% | ||
| ROIC | 6.13% |
ROA(3y)5.15%
ROA(5y)5.09%
ROE(3y)12.11%
ROE(5y)11.87%
ROIC(3y)6.4%
ROIC(5y)6.17%
1.3 Margins
- Looking at the Profit Margin, with a value of 6.22%, TXT is in line with its industry, outperforming 60.00% of the companies in the same industry.
- TXT's Profit Margin has improved in the last couple of years.
- TXT has a Operating Margin (6.76%) which is comparable to the rest of the industry.
- TXT's Operating Margin has improved in the last couple of years.
- The Gross Margin of TXT (18.21%) is worse than 65.00% of its industry peers.
- In the last couple of years the Gross Margin of TXT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.76% | ||
| PM (TTM) | 6.22% | ||
| GM | 18.21% |
OM growth 3Y-0.48%
OM growth 5Y9.01%
PM growth 3Y-2.38%
PM growth 5Y18.6%
GM growth 3Y4.24%
GM growth 5Y6.38%
2. TXT Health Analysis
2.1 Basic Checks
- TXT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, TXT has less shares outstanding
- The number of shares outstanding for TXT has been reduced compared to 5 years ago.
- TXT has a worse debt/assets ratio than last year.
2.2 Solvency
- TXT has an Altman-Z score of 2.58. 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.
- TXT has a Altman-Z score of 2.58. This is in the lower half of the industry: TXT underperforms 65.00% of its industry peers.
- TXT has a debt to FCF ratio of 4.17. This is a neutral value as TXT would need 4.17 years to pay back of all of its debts.
- The Debt to FCF ratio of TXT (4.17) is better than 73.75% of its industry peers.
- TXT has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
- The Debt to Equity ratio of TXT (0.49) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 4.17 | ||
| Altman-Z | 2.58 |
ROIC/WACC0.64
WACC9.58%
2.3 Liquidity
- TXT has a Current Ratio of 1.84. This is a normal value and indicates that TXT is financially healthy and should not expect problems in meeting its short term obligations.
- TXT's Current ratio of 1.84 is on the low side compared to the rest of the industry. TXT is outperformed by 65.00% of its industry peers.
- A Quick Ratio of 0.85 indicates that TXT may have some problems paying its short term obligations.
- TXT's Quick ratio of 0.85 is on the low side compared to the rest of the industry. TXT is outperformed by 82.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.84 | ||
| Quick Ratio | 0.85 |
3. TXT Growth Analysis
3.1 Past
- TXT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.50%, which is quite good.
- Measured over the past years, TXT shows a very strong growth in Earnings Per Share. The EPS has been growing by 24.17% on average per year.
- The Revenue has grown by 8.01% in the past year. This is quite good.
- TXT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.90% yearly.
EPS 1Y (TTM)11.5%
EPS 3Y15.07%
EPS 5Y24.17%
EPS Q2Q%29.1%
Revenue 1Y (TTM)8.01%
Revenue growth 3Y4.77%
Revenue growth 5Y4.9%
Sales Q2Q%15.55%
3.2 Future
- The Earnings Per Share is expected to grow by 6.59% on average over the next years.
- The Revenue is expected to grow by 3.47% on average over the next years.
EPS Next Y6.87%
EPS Next 2Y9.76%
EPS Next 3Y9.86%
EPS Next 5Y6.59%
Revenue Next Year5.63%
Revenue Next 2Y5.09%
Revenue Next 3Y4.33%
Revenue Next 5Y3.47%
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 decreasing.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. TXT Valuation Analysis
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 14.49, the valuation of TXT can be described as correct.
- Based on the Price/Earnings ratio, TXT is valued cheaper than 95.00% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 26.91, TXT is valued a bit cheaper.
- With a Price/Forward Earnings ratio of 13.56, TXT is valued correctly.
- 93.75% of the companies in the same industry are more expensive than TXT, based on the Price/Forward Earnings ratio.
- TXT is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.99, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.49 | ||
| Fwd PE | 13.56 |
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 88.75% of the companies listed in the same industry.
- TXT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TXT is cheaper than 97.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.6 | ||
| EV/EBITDA | 12.33 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- TXT has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.11
PEG (5Y)0.6
EPS Next 2Y9.76%
EPS Next 3Y9.86%
5. TXT Dividend Analysis
5.1 Amount
- TXT has a yearly dividend return of 0.09%, which is pretty low.
- TXT's Dividend Yield is a higher than the industry average which is at 0.38.
- Compared to an average S&P500 Dividend Yield of 1.82, TXT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
5.2 History
- The dividend of TXT decreases each year by -4.65%.
- TXT has been paying a dividend for at least 10 years, so it has a reliable track record.
- The dividend of TXT decreased in the last 3 years.
Dividend Growth(5Y)-4.65%
Div Incr Years0
Div Non Decr Years2
5.3 Sustainability
- TXT pays out 1.95% of its income as dividend. This is a sustainable payout ratio.
DP1.95%
EPS Next 2Y9.76%
EPS Next 3Y9.86%
TXT Fundamentals: All Metrics, Ratios and Statistics
NYSE:TXT (4/29/2026, 11:16:45 AM)
88.56
+0.42 (+0.48%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Industry Strength71.43
Industry Growth88.82
Earnings (Last)04-22 2026-04-22/bmo
Earnings (Next)07-22 2026-07-22/bmo
Inst Owners90.73%
Inst Owner Change0.17%
Ins Owners0.61%
Ins Owner Change1.29%
Market Cap15.42B
Revenue(TTM)14.80B
Net Income(TTM)921.00M
Analysts72.17
Price Target101.98 (15.15%)
Short Float %2.69%
Short Ratio3.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.09% |
Yearly Dividend0.06
Dividend Growth(5Y)-4.65%
DP1.95%
Div Incr Years0
Div Non Decr Years2
Ex-Date03-13 2026-03-13 (0.02)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.07%
Min EPS beat(2)0.5%
Max EPS beat(2)5.65%
EPS beat(4)4
Avg EPS beat(4)6.32%
Min EPS beat(4)0.5%
Max EPS beat(4)12.71%
EPS beat(8)5
Avg EPS beat(8)2.25%
EPS beat(12)9
Avg EPS beat(12)4.89%
EPS beat(16)12
Avg EPS beat(16)6.3%
Revenue beat(2)1
Avg Revenue beat(2)-1.4%
Min Revenue beat(2)-3.66%
Max Revenue beat(2)0.87%
Revenue beat(4)3
Avg Revenue beat(4)-0.23%
Min Revenue beat(4)-3.66%
Max Revenue beat(4)1.14%
Revenue beat(8)3
Avg Revenue beat(8)-2.24%
Revenue beat(12)3
Avg Revenue beat(12)-2.46%
Revenue beat(16)4
Avg Revenue beat(16)-2.4%
PT rev (1m)0.14%
PT rev (3m)6.93%
EPS NQ rev (1m)-2.3%
EPS NQ rev (3m)-7.41%
EPS NY rev (1m)-0.05%
EPS NY rev (3m)-5.17%
Revenue NQ rev (1m)0.65%
Revenue NQ rev (3m)0.37%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)0.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.49 | ||
| Fwd PE | 13.56 | ||
| P/S | 1.04 | ||
| P/FCF | 16.6 | ||
| P/OCF | 11.75 | ||
| P/B | 1.96 | ||
| P/tB | 2.78 | ||
| EV/EBITDA | 12.33 |
EPS(TTM)6.11
EY6.9%
EPS(NY)6.53
Fwd EY7.37%
FCF(TTM)5.34
FCFY6.03%
OCF(TTM)7.54
OCFY8.51%
SpS85
BVpS45.23
TBVpS31.9
PEG (NY)2.11
PEG (5Y)0.6
Graham Number78.8565 (-10.96%)
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.08% | ||
| ROE | 11.7% | ||
| ROCE | 7.27% | ||
| ROIC | 6.13% | ||
| ROICexc | 7.13% | ||
| ROICexgc | 8.87% | ||
| OM | 6.76% | ||
| PM (TTM) | 6.22% | ||
| GM | 18.21% | ||
| FCFM | 6.28% |
ROA(3y)5.15%
ROA(5y)5.09%
ROE(3y)12.11%
ROE(5y)11.87%
ROIC(3y)6.4%
ROIC(5y)6.17%
ROICexc(3y)7.46%
ROICexc(5y)7.26%
ROICexgc(3y)9.67%
ROICexgc(5y)9.53%
ROCE(3y)7.59%
ROCE(5y)7.31%
ROICexgc growth 3Y-1.05%
ROICexgc growth 5Y9.15%
ROICexc growth 3Y0.47%
ROICexc growth 5Y10.38%
OM growth 3Y-0.48%
OM growth 5Y9.01%
PM growth 3Y-2.38%
PM growth 5Y18.6%
GM growth 3Y4.24%
GM growth 5Y6.38%
F-Score7
Asset Turnover0.82
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 4.17 | ||
| Debt/EBITDA | 2.76 | ||
| Cap/Depr | 95.51% | ||
| Cap/Sales | 2.59% | ||
| Interest Coverage | 6.59 | ||
| Cash Conversion | 93.58% | ||
| Profit Quality | 100.87% | ||
| Current Ratio | 1.84 | ||
| Quick Ratio | 0.85 | ||
| Altman-Z | 2.58 |
F-Score7
WACC9.58%
ROIC/WACC0.64
Cap/Depr(3y)97.52%
Cap/Depr(5y)95.58%
Cap/Sales(3y)2.73%
Cap/Sales(5y)2.79%
Profit Quality(3y)91.19%
Profit Quality(5y)113.84%
High Growth Momentum
Growth
EPS 1Y (TTM)11.5%
EPS 3Y15.07%
EPS 5Y24.17%
EPS Q2Q%29.1%
EPS Next Y6.87%
EPS Next 2Y9.76%
EPS Next 3Y9.86%
EPS Next 5Y6.59%
Revenue 1Y (TTM)8.01%
Revenue growth 3Y4.77%
Revenue growth 5Y4.9%
Sales Q2Q%15.55%
Revenue Next Year5.63%
Revenue Next 2Y5.09%
Revenue Next 3Y4.33%
Revenue Next 5Y3.47%
EBIT growth 1Y12.09%
EBIT growth 3Y4.27%
EBIT growth 5Y14.35%
EBIT Next Year41.24%
EBIT Next 3Y18.05%
EBIT Next 5Y9.4%
FCF growth 1Y42.92%
FCF growth 3Y-6.43%
FCF growth 5Y15.55%
OCF growth 1Y29.39%
OCF growth 3Y-4.11%
OCF growth 5Y11.31%
TEXTRON INC / TXT Fundamental Analysis 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 of TEXTRON INC (TXT) stock?
ChartMill assigns a valuation rating of 6 / 10 to TEXTRON INC (TXT). This can be considered as Fairly Valued.
What is the profitability of TXT stock?
TEXTRON INC (TXT) has a profitability rating of 6 / 10.
Can you provide the expected EPS growth for TXT stock?
The Earnings per Share (EPS) of TEXTRON INC (TXT) is expected to grow by 6.87% in the next year.
How sustainable is the dividend of TEXTRON INC (TXT) stock?
The dividend rating of TEXTRON INC (TXT) is 3 / 10 and the dividend payout ratio is 1.95%.