TEXTRON INC (TXT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TXT - US8832031012 - Common Stock
84.41 USD
+0.94 (+1.13%)
84.5 USD
+0.09 (+0.11%)
Taking everything into account, TXT scores 5 out of 10 in our fundamental rating. TXT was compared to 72 industry peers in the Aerospace & Defense industry. TXT has an average financial health and profitability rating. TXT has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
TXT had positive earnings in the past year.
TXT had a positive operating cash flow in the past year.
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 66.67% of the companies in the same industry.
TXT has a Return On Equity of 11.04%. This is in the better half of the industry: TXT outperforms 73.61% of its industry peers.
TXT has a Return On Invested Capital of 6.29%. This is comparable to the rest of the industry: TXT outperforms 55.56% of its industry peers.
TXT had an Average Return On Invested Capital over the past 3 years of 6.46%. This is below the industry average of 8.58%.
| 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
With a decent Profit Margin value of 5.81%, TXT is doing good in the industry, outperforming 63.89% of the companies in the same industry.
In the last couple of years the Profit Margin of TXT has remained more or less at the same level.
TXT has a Operating Margin (6.57%) which is in line with its industry peers.
TXT's Operating Margin has declined in the last couple of years.
TXT has a worse Gross Margin (20.62%) than 61.11% of its industry peers.
TXT's Gross Margin has improved in the last couple of years.
| 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.
TXT has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, TXT has less shares outstanding
Compared to 1 year ago, TXT has an improved debt to assets ratio.
2.2 Solvency
TXT has an Altman-Z score of 2.62. 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.
With a Altman-Z score value of 2.62, TXT is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
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.
TXT's Debt to FCF ratio of 5.37 is fine compared to the rest of the industry. TXT outperforms 69.44% 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.
Looking at the Debt to Equity ratio, with a value of 0.45, TXT is in line with its industry, outperforming 51.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 5.37 | ||
| Altman-Z | 2.62 |
ROIC/WACC0.67
WACC9.37%
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.
TXT has a worse Current ratio (1.71) than 63.89% of its industry peers.
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: 84.72% 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%.
The Earnings Per Share has been growing slightly by 7.88% on average over the past years.
TXT shows a small growth in Revenue. In the last year, the Revenue has grown by 1.83%.
Measured over the past years, TXT shows a small growth in Revenue. The Revenue has been growing by 0.11% on average per year.
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.
TXT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.87% yearly.
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
The Price/Earnings ratio is 14.76, which indicates a correct valuation of TXT.
98.61% of the companies in the same industry are more expensive than TXT, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of TXT to the average of the S&P500 Index (26.34), we can say TXT is valued slightly cheaper.
A Price/Forward Earnings ratio of 12.19 indicates a correct valuation of TXT.
Based on the Price/Forward Earnings ratio, TXT is valued cheaper than 97.22% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.56. TXT is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.76 | ||
| Fwd PE | 12.19 |
4.2 Price Multiples
94.44% of the companies in the same industry are more expensive than TXT, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TXT indicates a rather cheap valuation: TXT is cheaper than 95.83% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.4 | ||
| EV/EBITDA | 12.75 |
4.3 Compensation for Growth
TXT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.17
PEG (5Y)1.87
EPS Next 2Y12.4%
EPS Next 3Y11.97%
5. Dividend
5.1 Amount
With a yearly dividend of 0.10%, TXT is not a good candidate for dividend investing.
TXT's Dividend Yield is a higher than the industry average which is at 1.12.
With a Dividend Yield of 0.10, TXT pays less dividend than the S&P500 average, which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.1% |
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 2Y12.4%
EPS Next 3Y11.97%
84.41
+0.94 (+1.13%)
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 Cap14.87B
Revenue(TTM)14.24B
Net Income(TTM)827.00M
Analysts74
Price Target92.66 (9.77%)
Short Float %20.32%
Short Ratio2.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.1% |
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%
EPS NQ rev (3m)-5.63%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.07%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.74%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.76 | ||
| Fwd PE | 12.19 | ||
| P/S | 1.04 | ||
| P/FCF | 21.4 | ||
| P/OCF | 14.06 | ||
| P/B | 1.99 | ||
| P/tB | 2.88 | ||
| EV/EBITDA | 12.75 |
EPS(TTM)5.72
EY6.78%
EPS(NY)6.92
Fwd EY8.2%
FCF(TTM)3.94
FCFY4.67%
OCF(TTM)6
OCFY7.11%
SpS80.79
BVpS42.52
TBVpS29.35
PEG (NY)1.17
PEG (5Y)1.87
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 | 2.62 |
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.