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Textron (TXT) Gains But Lags Market: What You Should Know

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Textron (TXT - Free Report) closed at $54.82 in the latest trading session, marking a +0.27% move from the prior day. This change lagged the S&P 500's 0.3% gain on the day. Meanwhile, the Dow 0%, and the Nasdaq, a tech-heavy index, added 0.92%.

Coming into today, shares of the maker of Cessna small planes and Bell helicopters had lost 1.01% in the past month. In that same time, the Aerospace sector lost 8.83%, while the S&P 500 lost 4.37%.

Wall Street will be looking for positivity from TXT as it approaches its next earnings report date. This is expected to be January 30, 2019. In that report, analysts expect TXT to post earnings of $1.01 per share. This would mark year-over-year growth of 36.49%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.92 billion, down 2.4% from the year-ago period.

TXT's full-year Zacks Consensus Estimates are calling for earnings of $3.20 per share and revenue of $14.21 billion. These results would represent year-over-year changes of +30.61% and +0.08%, respectively.

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

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.26% higher. TXT is holding a Zacks Rank of #4 (Sell) right now.

Looking at its valuation, TXT is holding a Forward P/E ratio of 17.09. For comparison, its industry has an average Forward P/E of 15.79, which means TXT is trading at a premium to the group.

We can also see that TXT currently has a PEG ratio of 1.05. 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. The Aerospace - Defense was holding an average PEG ratio of 1.46 at yesterday's closing price.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 74, which puts it in the top 29% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.




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