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Will Segmental Performance Aid Textron's (TXT) Q3 Earnings?
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Textron Inc. (TXT - Free Report) is scheduled to report third-quarter 2021 results on Oct 28, before market open.
Solid delivery figures along with a solid margin performance, courtesy of the gradually improving commercial aerospace, are likely to have boosted Textron’s operating performance in the soon-to-be-reported quarter.
Bell Segment Projections
During the third quarter of 2021, Textron’s Bell segment made a handful of deliveries. The unit delivered a Bell 505 helicopter to W.A. Oil Factory and Distribution PLC in Addis Ababa, Ethiopia. It also delivered a Bell 407GXi with an Instrument Flight Rules (IFR) kit to a Ukrainian corporate customer. Further, during the third quarter, the segment successfully completed its 100th consecutive on-time delivery of the AH-1Z aircraft to the U.S. Marine Corps, which began nearly four years ago.
Such deliveries are likely to aid the Bell unit’s quarterly results. However, lower military revenues might have hurt the unit’s overall performance.
The Zacks Consensus Estimate for the segment’s third-quarter revenues stands at $779 million, indicating a 1.8% decline from the year-ago-quarter’s reported figure.
During the third quarter, Textron Aviation segment’s Beechcraft King Air 360/360ER and King Air 260 achieved the European Aviation Safety Agency (EASA) type certification. Following this, the unit is expected to have begun deliveries of these two jets to customers throughout the region. These deliveries are likely to have positively impacted overall revenues in the third quarter. Moreover, with the gradual improvement observed in the commercial aerospace, aftermarket volume is likely to have been solid, thus boosting the unit’s top line.
The unit also introduced new interiors to its Beechcraft King Air 260 turboprop, which is likely to have boosted order growth for this segment.
The Zacks Consensus Estimate for Textron Aviation’s third-quarter sales stands at $1.15 billion, suggesting growth of 44.7% from the figure reported in the prior-year quarter.
A strong retail pricing environment driven by continued high customer demand in the company’s end markets is expected to have boosted performance at its specialized vehicles unit.
Moreover, increased commercial order flow at Textron Aviation and Bell segments over the past couple of quarters is expected to have boosted quarterly margins. This along with a solid sales performance is expected to have contributed to the company’s third-quarter earnings.
Q3 Expectation
Considering the aforementioned developments, sales and earnings expectations for Textron’s third quarter remain encouraging.
The Zacks Consensus Estimate for third-quarter revenues, pegged at $3.10 billion, implies a 13.5% increase from the past year’s third-quarter revenues. Estimates for earnings, pegged at 75 cents per share, suggests a solid 41.5% surge from the year-ago quarter’s reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Textron this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, but this is not the case here.
Textron has an Earnings ESP of -11.41% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a couple of defense companies you may want to consider, as these have the right combination of elements to post an earnings beat this season:
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Will Segmental Performance Aid Textron's (TXT) Q3 Earnings?
Textron Inc. (TXT - Free Report) is scheduled to report third-quarter 2021 results on Oct 28, before market open.
Solid delivery figures along with a solid margin performance, courtesy of the gradually improving commercial aerospace, are likely to have boosted Textron’s operating performance in the soon-to-be-reported quarter.
Bell Segment Projections
During the third quarter of 2021, Textron’s Bell segment made a handful of deliveries. The unit delivered a Bell 505 helicopter to W.A. Oil Factory and Distribution PLC in Addis Ababa, Ethiopia. It also delivered a Bell 407GXi with an Instrument Flight Rules (IFR) kit to a Ukrainian corporate customer. Further, during the third quarter, the segment successfully completed its 100th consecutive on-time delivery of the AH-1Z aircraft to the U.S. Marine Corps, which began nearly four years ago.
Such deliveries are likely to aid the Bell unit’s quarterly results. However, lower military revenues might have hurt the unit’s overall performance.
The Zacks Consensus Estimate for the segment’s third-quarter revenues stands at $779 million, indicating a 1.8% decline from the year-ago-quarter’s reported figure.
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Textron Inc. Quote
Other Factors at Play
During the third quarter, Textron Aviation segment’s Beechcraft King Air 360/360ER and King Air 260 achieved the European Aviation Safety Agency (EASA) type certification. Following this, the unit is expected to have begun deliveries of these two jets to customers throughout the region. These deliveries are likely to have positively impacted overall revenues in the third quarter. Moreover, with the gradual improvement observed in the commercial aerospace, aftermarket volume is likely to have been solid, thus boosting the unit’s top line.
The unit also introduced new interiors to its Beechcraft King Air 260 turboprop, which is likely to have boosted order growth for this segment.
The Zacks Consensus Estimate for Textron Aviation’s third-quarter sales stands at $1.15 billion, suggesting growth of 44.7% from the figure reported in the prior-year quarter.
A strong retail pricing environment driven by continued high customer demand in the company’s end markets is expected to have boosted performance at its specialized vehicles unit.
Moreover, increased commercial order flow at Textron Aviation and Bell segments over the past couple of quarters is expected to have boosted quarterly margins. This along with a solid sales performance is expected to have contributed to the company’s third-quarter earnings.
Q3 Expectation
Considering the aforementioned developments, sales and earnings expectations for Textron’s third quarter remain encouraging.
The Zacks Consensus Estimate for third-quarter revenues, pegged at $3.10 billion, implies a 13.5% increase from the past year’s third-quarter revenues. Estimates for earnings, pegged at 75 cents per share, suggests a solid 41.5% surge from the year-ago quarter’s reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Textron this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, but this is not the case here.
Textron has an Earnings ESP of -11.41% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a couple of defense companies you may want to consider, as these have the right combination of elements to post an earnings beat this season:
Transdigm Group (TDG - Free Report) has an Earnings ESP of +0.36% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
CAE Inc (CAE - Free Report) has an Earnings ESP of +9.46% and a Zacks Rank #3.
Huntington Ingalls (HII - Free Report) has an Earnings ESP of +3.59% and a Zacks Rank #2.