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Will Mixed Segment Performance Aid Textron's (TXT) Q2 Earnings?
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Textron Inc. (TXT - Free Report) is scheduled to report second-quarter 2022 results on Jul 28, before market open.
Textron has a four-quarter earnings surprise of 22.75%, on average. Solid commercial deliveries and favorable pricing are expected to have contributed to Textron’s revenues. However, lower volumes from Bell and Textron Systems might have hurt overall performance.
Textron Aviation Remains a Key Catalyst
With the commercial aviation market showing solid signs of recovery in recent times, TXT’s aviation segment’s performance is ramping up, driven by strong demand. Thus, one may expect the company to have witnessed strong deliveries for Citation jets and commercial turboprops in the second quarter. This, in turn, must have boosted the segment’s revenues. Also, higher aftermarket volume from increased aircraft utilization is expected to have added an impetus to this segment’s performance in the second quarter.
The Zacks Consensus Estimate for Textron Aviation segment’s revenues in the second quarter is pegged at $1,285 million, indicating an improvement of 10.7% from revenues reported in the year-ago quarter.
The Bell segment is likely to have been negatively impacted by lower revenues from the military business, primarily related to lower H-1 production. However, the commercial side of the segment is expected to reflect strong demand trends.
The Zacks Consensus Estimate for the Bell segment’s revenues in the second quarter is pegged at $735 million, indicating a decline of 17.5% from revenues reported in the year-ago quarter.
Lower Volumes From Textron Systems
The U.S. Army's withdrawal from Afghanistan on its fee-for-service as well as aircraft support contracts for Textron’s Air Systems might have resulted in lower volumes for the Textron Systems unit in the second quarter. This is expected to have negatively impacted its segment’s performance in the soon-to-be-reported quarter.
The Zacks Consensus Estimate for Textron System’s revenues in the second quarter is pegged at $294 million, indicating a decline of 11.7% from revenues reported in the year-ago quarter.
Bright Expectations for the Industrial Unit
We remain optimistic about the revenues from the Industrial unit, driven by favorable pricing, principally for the Specialized Vehicles product line. The Zacks Consensus Estimate for Textron System’s revenues in the second quarter is pegged at $838 million, indicating an improvement of 5.5% from revenues reported in the year-ago quarter.
Q2 Estimates
Considering the mixed segmental performance expected for TXT, we remain optimistic about its overall top-line outcome. The Zacks Consensus Estimate for second-quarter revenues is pegged at $3.23 billion, suggesting a rise of 1.3% from the figure reported in the year-ago quarter.
Higher commercial deliveries, favorable pricing and increased operating leverage must have bolstered its bottom line in the soon-to-be-reported quarter. Also, favorable revenues must have boosted its year-over-year earnings performance.
The Zacks Consensus Estimate for second-quarter earnings is pegged at 88 cents per share, indicating an improvement of 8.6% from the prior-year reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for TXT this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
Textron has an Earnings ESP of -0.38% and a Zacks Rank #3. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Stocks to Consider
Here are some defense companies you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases:
LHX delivered a four-quarter average earnings surprise of 2.32%. The Zacks Consensus Estimate for L3Harris’ second-quarter earnings, pegged at $3.16, has moved up 0.3% over the past seven days.
Spire Global, Inc. (SPIR - Free Report) : It has an Earnings ESP of +9.43% and a Zacks Rank #3. The company is scheduled to release its second-quarter results on Aug 10.
Spire delivered an earnings surprise of 7.7% in the last reported quarter. The Zacks Consensus Estimate for Spire’s second-quarter sales is pegged at $18.93 billion.
CAE Inc (CAE - Free Report) : The company is expected to release its fiscal first-quarter results soon. It holds a Zacks Rank #3 and has an Earnings ESP of +2.27%.
The Zacks Consensus Estimate for CAE’s fiscal first-quarter earnings, pegged at 18 cents, has remained unchanged over the past seven days. CAE delivered a four-quarter average earnings surprise of 7.67%.
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Will Mixed Segment Performance Aid Textron's (TXT) Q2 Earnings?
Textron Inc. (TXT - Free Report) is scheduled to report second-quarter 2022 results on Jul 28, before market open.
Textron has a four-quarter earnings surprise of 22.75%, on average. Solid commercial deliveries and favorable pricing are expected to have contributed to Textron’s revenues. However, lower volumes from Bell and Textron Systems might have hurt overall performance.
Textron Aviation Remains a Key Catalyst
With the commercial aviation market showing solid signs of recovery in recent times, TXT’s aviation segment’s performance is ramping up, driven by strong demand. Thus, one may expect the company to have witnessed strong deliveries for Citation jets and commercial turboprops in the second quarter. This, in turn, must have boosted the segment’s revenues. Also, higher aftermarket volume from increased aircraft utilization is expected to have added an impetus to this segment’s performance in the second quarter.
The Zacks Consensus Estimate for Textron Aviation segment’s revenues in the second quarter is pegged at $1,285 million, indicating an improvement of 10.7% from revenues reported in the year-ago quarter.
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Textron Inc. Quote
Bell’s Performance May Continue to Be a Drag
The Bell segment is likely to have been negatively impacted by lower revenues from the military business, primarily related to lower H-1 production. However, the commercial side of the segment is expected to reflect strong demand trends.
The Zacks Consensus Estimate for the Bell segment’s revenues in the second quarter is pegged at $735 million, indicating a decline of 17.5% from revenues reported in the year-ago quarter.
Lower Volumes From Textron Systems
The U.S. Army's withdrawal from Afghanistan on its fee-for-service as well as aircraft support contracts for Textron’s Air Systems might have resulted in lower volumes for the Textron Systems unit in the second quarter. This is expected to have negatively impacted its segment’s performance in the soon-to-be-reported quarter.
The Zacks Consensus Estimate for Textron System’s revenues in the second quarter is pegged at $294 million, indicating a decline of 11.7% from revenues reported in the year-ago quarter.
Bright Expectations for the Industrial Unit
We remain optimistic about the revenues from the Industrial unit, driven by favorable pricing, principally for the Specialized Vehicles product line. The Zacks Consensus Estimate for Textron System’s revenues in the second quarter is pegged at $838 million, indicating an improvement of 5.5% from revenues reported in the year-ago quarter.
Q2 Estimates
Considering the mixed segmental performance expected for TXT, we remain optimistic about its overall top-line outcome. The Zacks Consensus Estimate for second-quarter revenues is pegged at $3.23 billion, suggesting a rise of 1.3% from the figure reported in the year-ago quarter.
Higher commercial deliveries, favorable pricing and increased operating leverage must have bolstered its bottom line in the soon-to-be-reported quarter. Also, favorable revenues must have boosted its year-over-year earnings performance.
The Zacks Consensus Estimate for second-quarter earnings is pegged at 88 cents per share, indicating an improvement of 8.6% from the prior-year reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for TXT this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
Textron has an Earnings ESP of -0.38% and a Zacks Rank #3. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Stocks to Consider
Here are some defense companies you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases:
L3Harris Technologies (LHX - Free Report) : It is scheduled to release its second-quarter results on Jul 28. LHX has an Earnings ESP of +0.95% and holds a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
LHX delivered a four-quarter average earnings surprise of 2.32%. The Zacks Consensus Estimate for L3Harris’ second-quarter earnings, pegged at $3.16, has moved up 0.3% over the past seven days.
Spire Global, Inc. (SPIR - Free Report) : It has an Earnings ESP of +9.43% and a Zacks Rank #3. The company is scheduled to release its second-quarter results on Aug 10.
Spire delivered an earnings surprise of 7.7% in the last reported quarter. The Zacks Consensus Estimate for Spire’s second-quarter sales is pegged at $18.93 billion.
CAE Inc (CAE - Free Report) : The company is expected to release its fiscal first-quarter results soon. It holds a Zacks Rank #3 and has an Earnings ESP of +2.27%.
The Zacks Consensus Estimate for CAE’s fiscal first-quarter earnings, pegged at 18 cents, has remained unchanged over the past seven days. CAE delivered a four-quarter average earnings surprise of 7.67%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.