10Y annualized return is
positive but below market average
at 4.5% per year
TXT has met or exceeded earnings expectations in
the majority of
recent quarters (7/10)
Attractive Price-to-Earnings Ratio
Low Price-to-Sales Ratio
Reasonable Return on Equity
Positive Net Profit Margin
Strong Liquidity Ratios
Low Debt Levels
🛩️ Strong Backlog and Demand
📈 Diverse Revenue Streams
🔧 Efficiency Improvements
🌍 Growth in Aerospace and Defense
🔋 Investment in Innovation
High Price-to-Cash-Flow Ratio
Negative Operating Profit Margin
Poor Interest Coverage
⚠️ Financial Declines
🔄 Disruption from Strikes
📉 Industrial Segment Challenges
🧩 Uncertain Military Program Funding
Overall, Textron exhibits a solid business model with diverse revenue streams and a strong demand outlook, particularly in Aviation and Systems. However, challenges such as recent financial declines and uncertainties in the Industrial segment may temper growth expectations. The company's investment in future technologies and expected revenue growth provide a positive outlook for the coming year.
Analysis Date: January 22, 2025
Last Updated: March 12, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
Textron Inc. is a company that makes and sells various types of aircraft, including business jets and helicopters. They also create military vehicles and equipment, like drones and armored cars. Besides manufacturing, Textron provides services such as maintenance and repair for their products. Additionally, they offer financing options for customers who want to buy their aircraft and helicopters.
Streams of revenue
Geographic Distribution
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
Latest News
TXT's Q1 results are expected to reflect robust top-line performance from three of its major business segments.
WICHITA, Kan.--(BUSINESS WIRE)--McCauley Propeller announced its C780 propeller for the Beechcraft King Air B300 series successfully achieved ANAC cer...
Get a deeper insight into the potential performance of Textron (TXT) for the quarter ended March 2025 by going beyond Wall Street's top -and-bottom-li...
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$170.96
Current Market Price: $59.43
IV/P Ratio: 2.88x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
65.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for TXT
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (13.67)
P/B ratio ≤ 1.5 (1.56)
Current ratio ≥ 2.0 (6.79x)
Long-term debt < Net current assets (0.53x)
Margin of safety (65.0%)
TXT does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
11.74%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
18.26%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
6.01%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
A return on equity of 11.80% indicates a solid ability to generate profits from shareholders' equity, which is a positive indicator for profitability.
The net profit margin of 6.01% shows that the company retains a portion of revenue as profit, indicating effective cost management despite operating challenges.
An operating profit margin of -13.64% is concerning, indicating that the company is currently facing challenges in its operational efficiency.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.40x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
6.79x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
The current ratio of 6.79 and quick ratio of 2.48 indicate excellent short-term financial health, suggesting the company can easily cover its short-term liabilities.
The debt-to-equity ratio of 0.40 and debt-to-assets ratio of 0.17 indicate that the company maintains a conservative approach to leveraging, which supports financial stability.
An interest coverage ratio of -20.32 suggests that the company is currently unable to meet its interest obligations, raising concerns about long-term solvency.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
Textron Aviation reported a year-end backlog of $7.8 billion, up $676 million from 2023, indicating strong demand and customer interest in new product launches. Bell also showed robust performance with a backlog of $7.5 billion.
Textron operates in multiple segments including Aviation, Bell, Systems, and Industrial, which helps mitigate risks associated with downturns in any single market. Their Aviation and Systems segments showed resilience with strong order activity and profitability.
The company is focusing on improving production efficiencies post-strike, which is expected to enhance their profit margins. They also highlighted a strong aftermarket revenue growth of 6.3% in Aviation, reflecting stable customer demand.
The company experienced a decline in revenues and segment profits compared to the previous year, with adjusted income from continuing operations dropping to $5.48 per share from $5.59.
Operational challenges due to work stoppages at Aviation led to decreased manufacturing cash flow and lower segment profits, impacting Q4 results significantly.
Textron expects growth in the Aerospace and Defense sectors, projecting an overall revenue increase of about 7% for fiscal 2025, driven by increased deliveries and higher aftermarket volume.
Textron is investing in hybrid and electric aviation technologies, which positions them well for future market trends in sustainable aviation solutions.
The Industrial segment is expected to see lower revenues due to ongoing softness in specialized vehicles and markets, indicating a potential drag on overall growth.
Ongoing uncertainties with military program funding due to the longer fiscal 2025 continuing resolution could disrupt future contracts and revenue forecasts.