Gavin Parsons, an analyst from UBS, maintained the Hold rating on Textron. The associated price target remains the same with $99.00.
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Gavin Parsons has given his Hold rating due to a combination of factors that balance near-term execution issues against longer-term earnings potential. He views the recent share price decline as excessive in light of healthy order trends, attractive earnings growth relative to valuation, and the accelerated MV-75 program that should enhance profits over the next several years. However, the sharp fourth-quarter margin shortfall, lower-than-expected 2026 guidance, and limited visibility into positive estimate revisions lead him to a more cautious stance, particularly as Aviation’s margin recovery remains uncertain despite better revenue prospects.
A key concern for Parsons is that Textron’s Aviation business, central to the company’s earnings story, is still facing supply chain and productivity challenges that cap margin expansion even as deliveries improve. At the same time, the accelerated MV-75 ramp, while strategically attractive and likely to lift revenues, requires higher capital spending and entails an upfront LRIP charge that will pressure cash flow in the next few years. Although defense-related businesses, such as Systems, are benefiting from stronger demand and backlog growth, these positives are not enough to offset the combination of margin disappointment, below-consensus guidance, and near-term cash headwinds. Taken together, these factors support a Neutral (Hold) view rather than a more constructive rating at this stage.
According to TipRanks, Parsons is a 5-star analyst with an average return of 14.4% and a 77.14% success rate. Parsons covers the Industrials sector, focusing on stocks such as Boeing, Woodward, and Amentum Holdings, Inc..
In another report released today, TipRanks – OpenAI also downgraded the stock to a Hold with a $94.00 price target.