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Textron (TXT) Dips More Than Broader Markets: What You Should Know

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Textron (TXT - Free Report) closed at $56.73 in the latest trading session, marking a -0.82% move from the prior day. This change lagged the S&P 500's daily loss of 0.25%. Meanwhile, the Dow gained 0.04%, and the Nasdaq, a tech-heavy index, lost 0.53%.

Heading into today, shares of the maker of Cessna small planes and Bell helicopters had lost 15.11% over the past month, lagging the Aerospace sector's loss of 6.7% and the S&P 500's loss of 2.35% in that time.

Investors will be hoping for strength from TXT as it approaches its next earnings release, which is expected to be January 30, 2019. In that report, analysts expect TXT to post earnings of $0.99 per share. This would mark year-over-year growth of 33.78%. Meanwhile, our latest consensus estimate is calling for revenue of $3.91 billion, down 2.59% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.22 per share and revenue of $14.27 billion, which would represent changes of +31.43% and +0.51%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for TXT. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.87% lower. TXT is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note TXT's current valuation metrics, including its Forward P/E ratio of 17.77. This represents a premium compared to its industry's average Forward P/E of 16.62.

Meanwhile, TXT's PEG ratio is currently 1.35. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. TXT's industry had an average PEG ratio of 1.51 as of yesterday's close.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 37, which puts it in the top 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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