NYSE:TXT

Stock Analysis Report

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Executive Summary

Textron Inc. operates in the aircraft, defense, industrial, and finance businesses worldwide. More Details


Snowflake Analysis

Undervalued with moderate growth potential.


Similar Companies

Share Price & News

How has Textron's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TXT's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.3%

TXT

-6.9%

US Aerospace & Defense

-4.6%

US Market


1 Year Return

-26.1%

TXT

-35.0%

US Aerospace & Defense

11.5%

US Market

Return vs Industry: TXT exceeded the US Aerospace & Defense industry which returned -35% over the past year.

Return vs Market: TXT underperformed the US Market which returned 11.5% over the past year.


Shareholder returns

TXTIndustryMarket
7 Day-2.3%-6.9%-4.6%
30 Day-7.3%-8.8%-0.9%
90 Day-2.5%-7.5%2.2%
1 Year-25.9%-26.1%-21.6%-35.0%14.0%11.5%
3 Year-36.9%-37.2%-5.4%-24.3%34.5%25.6%
5 Year-18.1%-18.8%39.2%4.0%73.0%53.6%

Price Volatility Vs. Market

How volatile is Textron's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Textron undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TXT ($32.09) is trading below our estimate of fair value ($105.1)

Significantly Below Fair Value: TXT is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TXT is good value based on its PE Ratio (19.5x) compared to the US Aerospace & Defense industry average (19.8x).

PE vs Market: TXT is poor value based on its PE Ratio (19.5x) compared to the US market (18.1x).


Price to Earnings Growth Ratio

PEG Ratio: TXT is good value based on its PEG Ratio (0.5x)


Price to Book Ratio

PB vs Industry: TXT is good value based on its PB Ratio (1.3x) compared to the US Aerospace & Defense industry average (2.1x).


Next Steps

Future Growth

How is Textron forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

42.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TXT's forecast earnings growth (38.9% per year) is above the savings rate (2.2%).

Earnings vs Market: TXT's earnings (38.9% per year) are forecast to grow faster than the US market (22% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TXT's revenue (8.3% per year) is forecast to grow slower than the US market (10% per year).

High Growth Revenue: TXT's revenue (8.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TXT's Return on Equity is forecast to be low in 3 years time (10.5%).


Next Steps

Past Performance

How has Textron performed over the past 5 years?

-0.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TXT has a large one-off loss of $244.0M impacting its July 4 2020 financial results.

Growing Profit Margin: TXT's current net profit margins (3%) are lower than last year (8.9%).


Past Earnings Growth Analysis

Earnings Trend: TXT's earnings have grown by 3.1% per year over the past 5 years.

Accelerating Growth: TXT's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TXT had negative earnings growth (-68.1%) over the past year, making it difficult to compare to the Aerospace & Defense industry average (1.8%).


Return on Equity

High ROE: TXT's Return on Equity (6.8%) is considered low.


Next Steps

Financial Health

How is Textron's financial position?


Financial Position Analysis

Short Term Liabilities: TXT's short term assets ($8.9B) exceed its short term liabilities ($4.1B).

Long Term Liabilities: TXT's short term assets ($8.9B) exceed its long term liabilities ($5.9B).


Debt to Equity History and Analysis

Debt Level: TXT's debt to equity ratio (85.6%) is considered high.

Reducing Debt: TXT's debt to equity ratio has increased from 84.3% to 85.6% over the past 5 years.

Debt Coverage: TXT's debt is not well covered by operating cash flow (19.5%).

Interest Coverage: TXT's interest payments on its debt are well covered by EBIT (5.4x coverage).


Balance Sheet


Next Steps

Dividend

What is Textron current dividend yield, its reliability and sustainability?

0.23%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TXT's dividend (0.25%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.71%).

High Dividend: TXT's dividend (0.25%) is low compared to the top 25% of dividend payers in the US market (4.86%).


Stability and Growth of Payments

Stable Dividend: TXT is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: TXT is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: TXT is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TXT's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.1yrs

Average management tenure


CEO

Scott Donnelly (58 yo)

10.83yrs

Tenure

US$18,921,598

Compensation

Mr. Scott C. Donnelly has been the Chairman, Chief Executive Officer and President of Textron Inc. since September 1, 2010, December 1, 2009 and January 2009 respectively. Mr. Donnelly serves Co-President ...


CEO Compensation Analysis

Compensation vs Market: Scott's total compensation ($USD18.92M) is above average for companies of similar size in the US market ($USD7.34M).

Compensation vs Earnings: Scott's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Scott Donnelly
Chairman10.83yrsUS$18.92m0.28%
$ 20.7m
Frank Connor
Executive VP & CFO11.17yrsUS$6.68m0.074%
$ 5.4m
E. Lupone
Executive VP8.67yrsUS$2.95m0.040%
$ 3.0m
Julie Duffy
Executive Vice President of Human Resources3.25yrsUS$2.82m0.017%
$ 1.2m
Kimberly Mackenroth
VP & Chief Information Officer2.75yrsno datano data
Eric Salander
VP of Investor Relations & Treasurer3.83yrsno datano data
James Takats
Senior Vice President of Global Simulation & Training Strategy TRU Simulation + Training Inc5.08yrsno datano data
Jorg Rautenstrauch
CEO & President of Industrial Segment0.50yrno datano data
Stewart Holmes
Senior Vice President of Washington Operations3.58yrsno datano data
Ee Soon-Kiong
President of Textron China17.58yrsno datano data
Mark Bamford
VP & Corporate Controllerno datano data0.0080%
$ 587.6k
Ricardo Maldonado
CEO & President of Textron Financial Corporation5.83yrsno datano data

5.1yrs

Average Tenure

58yo

Average Age

Experienced Management: TXT's management team is seasoned and experienced (5.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Scott Donnelly
Chairman10.83yrsUS$18.92m0.28%
$ 20.7m
Kathleen Bader
Independent Director16.75yrsUS$275.00k0.0077%
$ 564.9k
Lionel Nowell
Director0.75yrno data0.0030%
$ 219.5k
James Ziemer
Independent Director13.58yrsUS$280.00k0.0031%
$ 223.9k
Paul Gagné
Independent Lead Director2.5yrsUS$305.00k0.0044%
$ 324.2k
Ralph Heath
Independent Director3.75yrsUS$280.00k0.0030%
$ 219.5k
Deborah James
Independent Director3.25yrsUS$275.00k0.0030%
$ 219.5k
Ronal Clark
Independent Director17yrsUS$297.50k0.0052%
$ 379.8k
James Conway
Independent Director9.5yrsUS$275.00k0.0030%
$ 220.3k
Maria Zuber
Independent Director3.92yrsUS$260.00k0.0030%
$ 219.5k

6.7yrs

Average Tenure

68yo

Average Age

Experienced Board: TXT's board of directors are considered experienced (6.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Textron Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Textron Inc.
  • Ticker: TXT
  • Exchange: NYSE
  • Founded: 1923
  • Industry: Aerospace and Defense
  • Sector: Capital Goods
  • Market Cap: US$7.318b
  • Shares outstanding: 228.04m
  • Website: https://www.textron.com

Number of Employees


Location

  • Textron Inc.
  • 40 Westminster Street
  • Providence
  • Rhode Island
  • 2903
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TXTNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
TXTDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
TXT *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
0LF0LSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
T1XT34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

Textron Inc. operates in the aircraft, defense, industrial, and finance businesses worldwide. The company’s Textron Aviation segment manufactures, sells, and services business jets, turboprop and piston en ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/29 23:53
End of Day Share Price2020/10/29 00:00
Earnings2020/10/03
Annual Earnings2020/01/04


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.