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Reasons to Add Textron (TXT) to Your Portfolio Right Now
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Textron Inc. (TXT - Free Report) is an aerospace defense company that manufactures aircraft, automotive engine components and industrial tools. The company’s stable financial position and well-diversified product portfolio make it a strong candidate for investment in the defense space.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) stock a strong investment pick at the moment.
Growth Projections & Surprise History
Textron’s long-term (three-to-five-year) earnings growth expectation is 11.7%.
The Zacks Consensus Estimate for TXT’s 2023 earnings per share (EPS) is pegged at $5.48. The bottom-line estimates have moved up 3.4% in the past 90 days.
The Zacks Consensus Estimate for 2023 sales is pegged at $13.7 billion, indicating growth of 6.4% from the 2022 reported figure.
TXT delivered a trailing four-quarter average earnings surprise of 14.13%.
Debt Position
The total debt-to-capital of TXT is 33.32%, better than 46.78% registered by the industry. This indicates that the company has less debt than its peers, which is a positive sign.
TXT has a current ratio of 1.88, better than the industry’s average of 1.12. This implies that the company has sufficient financial capability to pay its short-term debt obligations.
Strong Backlog and Innovations
The solid demand for Textron’s products resulted in a total backlog of $14.53 billion at the end of third-quarter 2023.
Textron has been continuously innovating products to expand its footprint in the aerospace market. During third-quarter 2023, Textron Aviation launched the newest Cessna Citation business jet, the Cessna Citation CJ3 Gen2. Bell is also developing a new rotorcraft, the Bell 360 Invictus, for the U.S. Army's Future Attack Reconnaissance Aircraft Competitive Prototype Program.
Return on Equity (ROE)
ROE is a measure of a company’s financial performance and shows how it is utilizing its funds. TXT’s current ROE is 14.7%, better than the industry’s average of 10.55%, which indicates that the company is utilizing its funds more efficiently than its peers.
Price Performance
In the past year, TXT’s shares have rallied 14.5% against the industry’s average decline of 7.1%.
SPCE boasts a long-term earnings growth rate of 40.3%. The Zacks Consensus Estimate for 2023 sales is pegged at $6.75 million, implying an improvement of 192.1% from the 2022 reported figure.
LDOS boasts a long-term earnings growth rate of 8.1%. The Zacks Consensus Estimate for 2023 sales is pegged at $15.25 billion, implying a year-over-year improvement of 5.9%.
TDG boasts a long-term earnings growth rate of 16.3%. The Zacks Consensus Estimate for fiscal 2024 sales is pegged at $7.59 billion, implying a year-over-year improvement of 15.2% from the fiscal 2023 reported figure.
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Reasons to Add Textron (TXT) to Your Portfolio Right Now
Textron Inc. (TXT - Free Report) is an aerospace defense company that manufactures aircraft, automotive engine components and industrial tools. The company’s stable financial position and well-diversified product portfolio make it a strong candidate for investment in the defense space.
Let’s focus on the factors that make this Zacks Rank #2 (Buy) stock a strong investment pick at the moment.
Growth Projections & Surprise History
Textron’s long-term (three-to-five-year) earnings growth expectation is 11.7%.
The Zacks Consensus Estimate for TXT’s 2023 earnings per share (EPS) is pegged at $5.48. The bottom-line estimates have moved up 3.4% in the past 90 days.
The Zacks Consensus Estimate for 2023 sales is pegged at $13.7 billion, indicating growth of 6.4% from the 2022 reported figure.
TXT delivered a trailing four-quarter average earnings surprise of 14.13%.
Debt Position
The total debt-to-capital of TXT is 33.32%, better than 46.78% registered by the industry. This indicates that the company has less debt than its peers, which is a positive sign.
TXT has a current ratio of 1.88, better than the industry’s average of 1.12. This implies that the company has sufficient financial capability to pay its short-term debt obligations.
Strong Backlog and Innovations
The solid demand for Textron’s products resulted in a total backlog of $14.53 billion at the end of third-quarter 2023.
Textron has been continuously innovating products to expand its footprint in the aerospace market. During third-quarter 2023, Textron Aviation launched the newest Cessna Citation business jet, the Cessna Citation CJ3 Gen2. Bell is also developing a new rotorcraft, the Bell 360 Invictus, for the U.S. Army's Future Attack Reconnaissance Aircraft Competitive Prototype Program.
Return on Equity (ROE)
ROE is a measure of a company’s financial performance and shows how it is utilizing its funds. TXT’s current ROE is 14.7%, better than the industry’s average of 10.55%, which indicates that the company is utilizing its funds more efficiently than its peers.
Price Performance
In the past year, TXT’s shares have rallied 14.5% against the industry’s average decline of 7.1%.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks in the same sector are Virgin Galactic Holdings Inc. (SPCE - Free Report) , Leidos Holdings Inc. (LDOS - Free Report) and TransDigm Group Inc. (TDG - Free Report) . Each stock carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
SPCE boasts a long-term earnings growth rate of 40.3%. The Zacks Consensus Estimate for 2023 sales is pegged at $6.75 million, implying an improvement of 192.1% from the 2022 reported figure.
LDOS boasts a long-term earnings growth rate of 8.1%. The Zacks Consensus Estimate for 2023 sales is pegged at $15.25 billion, implying a year-over-year improvement of 5.9%.
TDG boasts a long-term earnings growth rate of 16.3%. The Zacks Consensus Estimate for fiscal 2024 sales is pegged at $7.59 billion, implying a year-over-year improvement of 15.2% from the fiscal 2023 reported figure.