Textron: Aviation Strength Offset by MV-75 Headwinds, Capex Step-Up, and Portfolio Uncertainty Supports Hold Rating

In a report released yesterday, Gautam Khanna from TD Cowen maintained a Hold rating on Textron, with a price target of $95.00.

Gautam Khanna has given his Hold rating due to a combination of factors that balance emerging opportunities with near‑term financial and execution headwinds. The softer-than-expected 2026 EPS outlook, together with the anticipated MV-75 program charge that will be recognized when the Army places the next low-rate production order, constrains upside versus current market expectations. Additionally, the MV-75 business is expected to deliver only modest sales growth with relatively low margins for the next few years, keeping Bell’s profitability under pressure until better pricing and learning-curve benefits from the subsequent production lot can be realized.
On the positive side, Textron’s Aviation segment is showing healthy demand, with stronger-than-anticipated recent deliveries and guidance for solid 2026 sales growth driven by higher output across multiple platforms. Management also expects long-term incremental margins in Aviation to move higher, although the near-term margin profile is flattish after recasting. However, the sizable step-up in capital expenditures tied to the MV-75 ramp, coupled with limited clarity on capital deployment priorities and only tentative indications of future portfolio reshaping under the new CEO, leads Khanna to see a balanced risk/reward profile at current levels, supporting a Hold rather than a more aggressive rating change.

In another report released yesterday, TipRanks – Anthropic also downgraded the stock to a Hold with a $103.00 price target.