TEXTRON INC (TXT) Stock Fundamental Analysis
USA - NYSE:TXT - US8832031012 - Common Stock
79.76 USD
-0.22 (-0.28%)
79.76 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. TXT has only an average score on both its financial health and profitability. A decent growth rate in combination with a cheap valuation! Better keep an eye on TXT.
1. Profitability
1.1 Basic Checks
In the past year TXT was profitable.
TXT had a positive operating cash flow in the past year.
In the past 5 years TXT has always been profitable.
Each year in the past 5 years TXT had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 4.76%, TXT is doing good in the industry, outperforming 64.79% of the companies in the same industry.
The Return On Equity of TXT (11.04%) is better than 71.83% of its industry peers.
With a Return On Invested Capital value of 6.29%, TXT perfoms like the industry average, outperforming 56.34% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TXT is below the industry average of 8.48%.
| 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 64.79% of its industry peers.
TXT's Profit Margin has been stable in the last couple of years.
The Operating Margin of TXT (6.57%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of TXT has declined.
TXT has a worse Gross Margin (20.62%) than 60.56% 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
TXT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
TXT has less shares outstanding than it did 1 year ago.
The number of shares outstanding for TXT has been reduced compared to 5 years ago.
TXT has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.59 indicates that TXT is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of TXT (2.59) is worse than 61.97% of its industry peers.
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.
Looking at the Debt to FCF ratio, with a value of 5.37, TXT is in the better half of the industry, outperforming 67.61% 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 (0.45) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 5.37 | ||
| Altman-Z | 2.59 |
ROIC/WACC0.68
WACC9.22%
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.
Looking at the Current ratio, with a value of 1.71, TXT is doing worse than 60.56% 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's Quick ratio of 0.73 is on the low side compared to the rest of the industry. TXT is outperformed by 84.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.71 | ||
| Quick Ratio | 0.73 |
3. Growth
3.1 Past
The earnings per share for TXT have decreased by -0.35% in the last year.
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%.
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 10.97% on average over the next years. This is quite good.
Based on estimates for the next years, TXT will show a small growth in Revenue. The Revenue will grow by 3.86% on average per year.
EPS Next Y12.65%
EPS Next 2Y13.06%
EPS Next 3Y12.15%
EPS Next 5Y10.97%
Revenue Next Year6.93%
Revenue Next 2Y5.84%
Revenue Next 3Y5.03%
Revenue Next 5Y3.86%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 13.94, which indicates a correct valuation of TXT.
Based on the Price/Earnings ratio, TXT is valued cheaper than 97.18% of the companies in the same industry.
When comparing the Price/Earnings ratio of TXT to the average of the S&P500 Index (26.03), we can say TXT is valued slightly cheaper.
With a Price/Forward Earnings ratio of 11.39, the valuation of TXT can be described as very reasonable.
97.18% of the companies in the same industry are more expensive than TXT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.27, TXT is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.94 | ||
| Fwd PE | 11.39 |
4.2 Price Multiples
94.37% 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 97.18% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.45 | ||
| EV/EBITDA | 12.38 |
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 12.15% in the coming years.
PEG (NY)1.1
PEG (5Y)1.77
EPS Next 2Y13.06%
EPS Next 3Y12.15%
5. Dividend
5.1 Amount
TXT has a yearly dividend return of 0.10%, which is pretty low.
Compared to an average industry Dividend Yield of 1.10, TXT pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.38, TXT's dividend is way lower than the S&P500 average.
| 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.
TXT has decreased its dividend recently.
Dividend Growth(5Y)-4.65%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
1.81% of the earnings are spent on dividend by TXT. This is a low number and sustainable payout ratio.
DP1.81%
EPS Next 2Y13.06%
EPS Next 3Y12.15%
79.76
-0.22 (-0.28%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners89.03%
Inst Owner Change-0.19%
Ins Owners0.52%
Ins Owner Change-0.05%
Market Cap14.21B
Revenue(TTM)14.24B
Net Income(TTM)827.00M
Analysts74
Price Target92.59 (16.09%)
Short Float %2.23%
Short Ratio2.86
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)-1.24%
PT rev (3m)3.25%
EPS NQ rev (1m)-5.35%
EPS NQ rev (3m)-5.26%
EPS NY rev (1m)-0.07%
EPS NY rev (3m)-0.21%
Revenue NQ rev (1m)-0.74%
Revenue NQ rev (3m)-0.29%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)0.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.94 | ||
| Fwd PE | 11.39 | ||
| P/S | 1 | ||
| P/FCF | 20.45 | ||
| P/OCF | 13.43 | ||
| P/B | 1.9 | ||
| P/tB | 2.75 | ||
| EV/EBITDA | 12.38 |
EPS(TTM)5.72
EY7.17%
EPS(NY)7
Fwd EY8.78%
FCF(TTM)3.9
FCFY4.89%
OCF(TTM)5.94
OCFY7.44%
SpS79.89
BVpS42.05
TBVpS29.02
PEG (NY)1.1
PEG (5Y)1.77
Graham Number73.56
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 | 2.59 |
F-Score7
WACC9.22%
ROIC/WACC0.68
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 2Y13.06%
EPS Next 3Y12.15%
EPS Next 5Y10.97%
Revenue 1Y (TTM)1.83%
Revenue growth 3Y3.43%
Revenue growth 5Y0.11%
Sales Q2Q%5.11%
Revenue Next Year6.93%
Revenue Next 2Y5.84%
Revenue Next 3Y5.03%
Revenue Next 5Y3.86%
EBIT growth 1Y-8.24%
EBIT growth 3Y1.11%
EBIT growth 5Y-3.59%
EBIT Next Year50.55%
EBIT Next 3Y20.02%
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 7 / 10 to TEXTRON INC (TXT). This can be considered as Undervalued.
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.