Illinois Tool Works Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a good week for Illinois Tool Works Inc. (NYSE:ITW) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.5% to US$263. Revenues were US$4.0b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$3.91, an impressive 55% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Illinois Tool Works after the latest results.

View our latest analysis for Illinois Tool Works

Following the latest results, Illinois Tool Works' 17 analysts are now forecasting revenues of US$16.5b in 2025. This would be a credible 3.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to reduce 7.9% to US$10.77 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$16.6b and earnings per share (EPS) of US$10.77 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$255, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Illinois Tool Works at US$312 per share, while the most bearish prices it at US$215. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Illinois Tool Works shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Illinois Tool Works' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.7% growth on an annualised basis. This is compared to a historical growth rate of 4.8% over the past five years. Compare this to the 177 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 3.0% per year. Factoring in the forecast slowdown in growth, it looks like Illinois Tool Works is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$255, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Illinois Tool Works analysts - going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Illinois Tool Works that you need to take into consideration.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.