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Textron
(NYSE:TXT)
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Rating:69Neutral
Price Target:
$105.00
▲(9.91% Upside)
Action:Downgraded
Date:07/28/26
TXT scores in the high-60s primarily due to solid revenue scale and a manageable balance sheet, tempered by weakening free cash flow and cash conversion. Technicals are supportive with the stock trading above major moving averages, while valuation appears reasonable on the provided P/E and dividend yield. The latest earnings call reiterates guidance and highlights strong backlogs, but meaningful near-term execution and MV-75 funding timing risks keep the overall score in check.
Positive Factors
Multi-year backlog strength
Large, diversified backlogs across Aviation, Bell and Systems give durable revenue visibility that supports production planning, aftermarket capture and margin recovery over multiple quarters. This multi-year backlog reduces near-term revenue cyclicality and underpins medium-term cash flow and investment planning.
Negative Factors
Weakened cash generation
A meaningful decline in free cash flow and below-par cash conversion reduces the firm's ability to self-fund growth, accelerate debt paydown or sustain buybacks without altering capital allocation. Persistently weaker cash conversion could constrain flexibility and increase sensitivity to execution or funding shocks over coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Multi-year backlog strength
Large, diversified backlogs across Aviation, Bell and Systems give durable revenue visibility that supports production planning, aftermarket capture and margin recovery over multiple quarters. This multi-year backlog reduces near-term revenue cyclicality and underpins medium-term cash flow and investment planning.
Read all positive factors
Textron Key Performance Indicators (KPIs)
Any
Revenue by Geography
Sales broken down by region to show where demand is coming from and how exposed the company is to local economic cycles, trade policy, or currency moves. For Textron, international versus U.S. revenue highlights sensitivity of helicopter, aviation, and defense businesses to global markets and can explain swings in growth or margins.
Sales broken down by region to show where demand is coming from and how exposed the company is to local economic cycles, trade policy, or currency moves. For Textron, international versus U.S. revenue highlights sensitivity of helicopter, aviation, and defense businesses to global markets and can explain swings in growth or margins.
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The Fly
The FlyTextron (TXT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$14.66B
Dividend Yield0.09%
Average Volume (3M)1.50M
Price to Earnings (P/E)16.1
Beta (1Y)1.00
Revenue Growth8.80%
EPS Growth19.82%
CountryUS
Employees34,000
SectorGeneral
Sector StrengthN/A
IndustryAerospace & Defense
Share Statistics
EPS (TTM)5.30
Shares Outstanding171,986,920
10 Day Avg. Volume1,378,423
30 Day Avg. Volume1,502,840
Financial Highlights & Ratios
PEG Ratio1.02
Price to Book (P/B)1.99
Price to Sales (P/S)1.06
P/FCF Ratio17.75
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$99.30Price Target Upside3.95% Upside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)6.46
Revenue Forecast (FY)$15.58B
Textron Business Overview & Revenue Model
Company Description
Textron Inc. (TXT) is a diverse global enterprise with significant involvement in the aerospace, defense, industrial, and financial sectors. Its Textron Aviation division is responsible for the production, sale, and maintenance of a variety of air...
How the Company Makes Money
Textron primarily makes money by manufacturing and selling high-value engineered products and then generating recurring revenue from aftermarket support over the life of those assets. (1) Aircraft and rotorcraft sales: A major source of revenue co...
Textron Earnings Call Summary
Earnings Call Date:Jul 28, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 22, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and demand backdrop — revenue growth, strong backlogs across aviation, Bell and systems, key product milestones, and strategic progress toward becoming a pure-play aerospace & defense company. However, near-term execution and liquidity headwinds were emphasized: a sizable drop in manufacturing cash flow, manufacturing inefficiencies (especially in Aviation), supply‑chain and newer‑workforce productivity challenges, and funding timing risk for the MV‑75 program that could reduce EPS and cash flow if additional FY26 funds are not received. Management reiterated full‑year guidance while outlining concrete investments and steps to address execution gaps.Positive Updates
Consolidated Revenue Growth
Total revenues of $3.8 billion in Q2 2026, up 3% year-over-year (+$111 million). First half revenues up $500 million or 7% versus prior year.
Negative Updates
Manufacturing Cash Flow Decline
Manufacturing cash flow before pension contributions fell to $154 million in Q2 2026 from $336 million in Q2 2025 — a decline of $182 million (~54%), a notable cash generation deterioration.
Read all updates
Q2-2026 Updates
Positive
Negative
Consolidated Revenue Growth
Total revenues of $3.8 billion in Q2 2026, up 3% year-over-year (+$111 million). First half revenues up $500 million or 7% versus prior year.
Read all positive updates
Company Guidance
Textron reiterated full‑year guidance of adjusted EPS $6.40–$6.60 and manufacturing cash flow before pension contributions of $700M–$800M, noting that this outlook assumes receipt of the Army’s FY‑26 MV‑75 reprogramming request (~$350M); absent that funding adjusted EPS could be down $0.20–$0.30 and cash flow down $150M–$250M. Management is managing near‑term MV‑75 spending to a $350M cap while self‑funding work and expects a potential LRIP charge of $60M–$110M on contract exercise (Q4/Q1). They also said Q3 Aviation revenue cadence should resemble Q2 with margin improvement in Q4, cited an Aviation incremental margin target of ~20–25% and an estimated ~$150M (≈200 bps) profit opportunity from productivity gains, and left full‑year revenue broadly in line with prior outlook while noting segment puts‑and‑takes (Industrial likely above guide, Systems high‑side, Aviation potentially at the low end if ATR is not received).Textron Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
76
Positive
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 15.30B | 14.80B | 13.70B | 13.68B | 12.87B | 12.38B |
| Gross Profit | 1.83B | 2.50B | 2.50B | 2.85B | 2.67B | 2.08B |
| EBITDA | 1.51B | 1.65B | 1.42B | 1.56B | 1.52B | 1.41B |
| Net Income | 937.00M | 921.00M | 824.00M | 921.00M | 861.00M | 746.00M |
Balance Sheet | ||||||
| Total Assets | 18.13B | 18.13B | 16.84B | 16.86B | 16.29B | 15.83B |
| Cash, Cash Equivalents and Short-Term Investments | 1.44B | 2.02B | 1.44B | 2.18B | 2.04B | 2.12B |
| Total Debt | 4.21B | 4.28B | 3.96B | 4.25B | 3.94B | 4.15B |
| Total Liabilities | 10.08B | 10.25B | 9.63B | 9.87B | 9.18B | 9.01B |
| Stockholders Equity | 8.05B | 7.88B | 7.20B | 6.99B | 7.11B | 6.82B |
Cash Flow | ||||||
| Free Cash Flow | 622.00M | 884.00M | 864.00M | 864.00M | 1.22B | 451.00M |
| Operating Cash Flow | 1.09B | 1.27B | 1.27B | 1.27B | 1.60B | 768.00M |
| Investing Cash Flow | -433.00M | -351.00M | -317.00M | -317.00M | -281.00M | -248.00M |
| Financing Cash Flow | -650.00M | -1.25B | -813.00M | -813.00M | -1.45B | 360.00M |
Textron Technical Analysis
Neutral
95.53
Price Trends
90.60
Negative
90.48
Negative
89.70
Negative
Market Momentum
-0.76
Positive
49.20
Neutral
40.62
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TXT, the sentiment is Neutral. The current price of 95.53 is above the 20-day moving average (MA) of 89.85, above the 50-day MA of 90.60, and above the 200-day MA of 89.70, indicating a bearish trend. The MACD of -0.76 indicates Positive momentum. The RSI at 49.20 is Neutral, neither overbought nor oversold. The STOCH value of 40.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TXT.
Textron Risk Analysis
Textron disclosed 26 risk factors in its most recent earnings report. Textron reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Textron Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $103.74B | 23.06 | 17.43% | 1.60% | 9.13% | 10.37% | |
76 Outperform | $134.49B | 21.38 | 86.24% | 2.34% | 7.20% | 52.79% | |
70 Outperform | $77.07B | 17.20 | 26.58% | 1.73% | 5.90% | 16.00% | |
69 Neutral | $14.66B | 16.09 | 11.93% | 0.08% | 8.80% | 19.82% | |
68 Neutral | $51.59B | 27.82 | 9.52% | 1.63% | 7.29% | 10.75% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
49 Neutral | $170.83B | 80.95 | 104.83% | ― | 24.78% | ― |
* General Sector Average
TXT
Textron
89.43
11.92
15.38%
BA
Boeing
234.42
8.46
3.74%
GD
General Dynamics
392.05
82.58
26.68%
LHX
L3Harris Technologies
286.67
20.66
7.77%
LMT
Lockheed Martin
587.95
172.89
41.65%
NOC
Northrop Grumman
571.58
0.30
0.05%
Textron Corporate Events
Executive/Board ChangesShareholder Meetings
Textron Shareholders Back Board, Auditors and Executive Pay
Positive
May 1, 2026
At Textron Inc.’s 2026 Annual Meeting of Shareholders held on April 29, 2026, all nominated directors, including CEO Scott C. Donnelly and board members such as Richard F. Ambrose and Lisa M. Atherton, were elected to serve until the next an...
Business Operations and StrategyStock BuybackFinancial Disclosures
Textron Posts Strong Q1 Results, Plans Industrial Separation
Positive
Apr 30, 2026
On April 30, 2026, Textron reported first-quarter 2026 revenue of $3.7 billion, up 12% year on year, with GAAP earnings of $1.25 per share and adjusted earnings of $1.45, driven by strong growth at Textron Aviation, higher military volume at Bell ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.