TEXTRON INC (TXT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TXT - US8832031012 - Common Stock
87.17 USD
-1.17 (-1.32%)
87.17 USD
0 (0%)
TXT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 71 industry peers in the Aerospace & Defense industry. Both the profitability and the financial health of TXT get a neutral evaluation. Nothing too spectacular is happening here. TXT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
TXT had positive earnings in the past year.
In the past year TXT had a positive cash flow from operations.
TXT had positive earnings in each of the past 5 years.
In the past 5 years TXT always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.76%, TXT is in the better half of the industry, outperforming 67.61% of the companies in the same industry.
The Return On Equity of TXT (11.04%) is better than 70.42% of its industry peers.
The Return On Invested Capital of TXT (6.29%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital 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 better Profit Margin (5.81%) than 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.
The Gross Margin of TXT (20.62%) is worse than 60.56% 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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.
Compared to 1 year ago, TXT has an improved debt to assets ratio.
2.2 Solvency
TXT has an Altman-Z score of 2.66. 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.
The Altman-Z score of TXT (2.66) is worse than 61.97% of its industry peers.
TXT has a debt to FCF ratio of 5.37. This is a neutral value as TXT would need 5.37 years to pay back of all of its debts.
The Debt to FCF ratio of TXT (5.37) is better than 69.01% of its industry peers.
TXT has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
TXT's Debt to Equity ratio of 0.45 is in line compared to the rest of the industry. TXT outperforms 53.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 5.37 | ||
| Altman-Z | 2.66 |
ROIC/WACC0.65
WACC9.67%
2.3 Liquidity
TXT has a Current Ratio of 1.71. This is a normal value and indicates that TXT is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.71, TXT is not doing good in the industry: 66.20% of the companies in the same industry are doing better.
A Quick Ratio of 0.73 indicates that TXT may have some problems paying its short term obligations.
With a Quick ratio value of 0.73, TXT is not doing good in the industry: 84.51% of the companies in the same industry are doing better.
| 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.
TXT shows a small growth in Revenue. In the last year, the Revenue has grown by 1.83%.
The Revenue has been growing slightly by 0.11% on average over the past years.
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
Based on estimates for the next years, TXT will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.64% on average per year.
Based on estimates for the next years, TXT will show a small growth in Revenue. The Revenue will grow by 3.87% on average per year.
EPS Next Y12.73%
EPS Next 2Y12.36%
EPS Next 3Y12%
EPS Next 5Y11.64%
Revenue Next Year6.19%
Revenue Next 2Y5.59%
Revenue Next 3Y4.89%
Revenue Next 5Y3.87%
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 accelerating.
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
The Price/Earnings ratio is 15.24, which indicates a correct valuation of TXT.
Based on the Price/Earnings ratio, TXT is valued cheaply inside the industry as 98.59% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of TXT to the average of the S&P500 Index (26.51), we can say TXT is valued slightly cheaper.
The Price/Forward Earnings ratio is 12.60, which indicates a correct valuation of TXT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TXT indicates a rather cheap valuation: TXT is cheaper than 98.59% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.13. TXT is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.24 | ||
| Fwd PE | 12.6 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TXT is valued cheaper than 94.37% of the companies in the same industry.
TXT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TXT is cheaper than 95.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.1 | ||
| EV/EBITDA | 13.24 |
4.3 Compensation for Growth
TXT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
A more expensive valuation may be justified as TXT's earnings are expected to grow with 12.00% in the coming years.
PEG (NY)1.2
PEG (5Y)1.93
EPS Next 2Y12.36%
EPS Next 3Y12%
5. Dividend
5.1 Amount
TXT has a yearly dividend return of 0.09%, which is pretty low.
Compared to an average industry Dividend Yield of 0.39, TXT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.09, TXT pays less dividend than the S&P500 average, which is at 2.00.
| 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 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 2Y12.36%
EPS Next 3Y12%
87.17
-1.17 (-1.32%)
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 Cap15.36B
Revenue(TTM)14.24B
Net Income(TTM)827.00M
Analysts74
Price Target94.18 (8.04%)
Short Float %2.71%
Short Ratio3.32
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-DateN/A
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)1.64%
PT rev (3m)0.46%
EPS NQ rev (1m)0.3%
EPS NQ rev (3m)-5.35%
EPS NY rev (1m)0.07%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)-0.69%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.24 | ||
| Fwd PE | 12.6 | ||
| P/S | 1.08 | ||
| P/FCF | 22.1 | ||
| P/OCF | 14.52 | ||
| P/B | 2.05 | ||
| P/tB | 2.97 | ||
| EV/EBITDA | 13.24 |
EPS(TTM)5.72
EY6.56%
EPS(NY)6.92
Fwd EY7.94%
FCF(TTM)3.94
FCFY4.52%
OCF(TTM)6
OCFY6.89%
SpS80.79
BVpS42.52
TBVpS29.35
PEG (NY)1.2
PEG (5Y)1.93
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 | 2.66 |
F-Score7
WACC9.67%
ROIC/WACC0.65
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 Y12.73%
EPS Next 2Y12.36%
EPS Next 3Y12%
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 2Y5.59%
Revenue Next 3Y4.89%
Revenue Next 5Y3.87%
EBIT growth 1Y-8.24%
EBIT growth 3Y1.11%
EBIT growth 5Y-3.59%
EBIT Next Year50.21%
EBIT Next 3Y19.58%
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.
Can you provide the valuation status for TEXTRON INC?
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.
What are the PE and PB ratios of TEXTRON INC (TXT) stock?
The Price/Earnings (PE) ratio for TEXTRON INC (TXT) is 15.24 and the Price/Book (PB) ratio is 2.05.
Can you provide the financial health for TXT stock?
The financial health rating of TEXTRON INC (TXT) is 4 / 10.