Textron (TXT)
NYSE:TXT
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Textron
(NYSE:TXT)
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Rating:73Outperform
Price Target:
$106.00
▲(15.71% Upside)
Action:ReiteratedDate:05/02/26
The score is driven primarily by solid fundamentals with improving leverage but pressured margins and weaker cash conversion, plus constructive technical momentum (price above major moving averages with positive MACD). Earnings-call commentary adds support via strong Q1 growth and backlog/strategic separation, tempered by near-term cash use, Bell commercial softness, and MV-75/separation execution uncertainty; valuation is neutral with a mid-range P/E and minimal yield.
Positive Factors
Large A&D Backlog
Textron's $19.2B aerospace & defense backlog across Aviation, Bell and Systems provides multi-year revenue visibility tied to funded programs and deliveries. That backlog supports production planning, stable aftermarket demand and steady revenue cadence versus pure-cycle OEM exposure, aiding long-term cash flow predictability.
Negative Factors
Margin Compression
A sharp gross margin decline (≈20.8% to ≈14.4% TTM) suggests lasting mix shifts, cost inflation or execution inefficiencies. Sustained lower margins compress operating profitability and ROE, reduce free cash flow capacity, and make long-term targets contingent on either higher volumes or structural cost reductions to restore margin sustainability.
Read all positive and negative factors
Positive Factors
Negative Factors
Large A&D Backlog
Textron's $19.2B aerospace & defense backlog across Aviation, Bell and Systems provides multi-year revenue visibility tied to funded programs and deliveries. That backlog supports production planning, stable aftermarket demand and steady revenue cadence versus pure-cycle OEM exposure, aiding long-term cash flow predictability.
Read all positive factors
Textron (TXT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.19B
Dividend Yield0.09%
Average Volume (3M)1.37M
Price to Earnings (P/E)17.6
Beta (1Y)1.07
Revenue Growth9.48%
EPS Growth18.21%
CountryUS
Employees34,000
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)5.24
Shares Outstanding173,888,980
10 Day Avg. Volume995,546
30 Day Avg. Volume1,368,823
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 Cap1.13
Enterprise Value/Revenue1.20
Enterprise Value/Gross Profit8.36
Enterprise Value/Ebitda11.39
Forecast
1Y Price Target
$104.44Price Target Upside14.01% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)6.51
Revenue Forecast (FY)$15.59B
Textron Business Overview & Revenue Model
Company Description
Textron Inc. operates in the aircraft, defense, industrial, and finance businesses. The company's Textron Aviation segment manufactures, sells, and services business jets, turboprop and piston engine aircraft, and military trainer and defense airc...
How the Company Makes Money
Textron makes money primarily by (1) selling manufactured products (aircraft, rotorcraft, defense systems, and specialty vehicles) and (2) generating recurring aftermarket and services revenue from its installed base.
Key revenue streams include:...
Textron Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive operating and strategic outlook: solid top-line, profit and EPS growth; substantial backlog across A&D franchises; program wins (ARV, LASSO) and clear progress on the MV-75 Cheyenne with government support. Management also announced a strategic separation intended to unlock value and sharpen capital allocation. Notable near-term negatives include increased use of manufacturing cash flow, Bell commercial revenue softness and margin pressure from mix and prior-period inefficiencies, supply-chain pockets (engines) and uncertainty around the timing of a potential MV-75 LRIP charge and separation execution. On balance the strong revenue/profit metrics, backlog expansion and strategic clarity outweigh the near-term operational and execution risks.Positive Updates
Strong Top-Line and Profit Growth
Revenue of $3.7 billion, up 12% year-over-year (≈$389M); segment profit $320 million, up 10% (≈$30M); adjusted EPS $1.45, up 13% from $1.28 a year ago.
Negative Updates
Manufacturing Cash Flow Use Increased
Manufacturing cash flow before pension contributions showed a use of cash of $228 million in the quarter versus a use of $158 million in the prior-year quarter (worsening cash outflow).
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Top-Line and Profit Growth
Revenue of $3.7 billion, up 12% year-over-year (≈$389M); segment profit $320 million, up 10% (≈$30M); adjusted EPS $1.45, up 13% from $1.28 a year ago.
Read all positive updates
Company Guidance
Management's directional guidance and near‑term expectations included Q1 results of $3.7B revenue (up 12% / +$389M), $320M segment profit (up 10% / +$30M), adjusted EPS $1.45 (up 13%), manufacturing cash use of $228M (vs $158M prior), and ~1.8M shares repurchased for $168M; they expect deliveries and efficiencies to improve sequentially each quarter with a margin peak in Q4. They outlined the New Textron pro forma as ~ $12B revenue and $1.2B segment profit, with top‑line growth ~150 bps higher and segment profit margin ~120 bps higher, a $19.2B backlog (100% A&D) comprised of Aviation $8.0B, Bell $7.6B and Systems $3.6B, and aftermarket representing >30% of New Textron revenue. Segment detail: Aviation delivered 37 jets and 35 turboprops, aircraft revenue $954M (+30%), aftermarket $531M (+10%) and segment profit $154M (10.4% margin); Bell revenue $1.1B (+9%) with military $795M (+25%) and commercial $275M (‑$74M) and segment profit $72M; Systems revenue $338M (+13%) and segment profit $42M (12.4%); Industrial revenue $786M and segment profit $40M (industrial organic +4%). On MV‑75 Cheyenne, the FYDP shows ~$2.3B for 2027 scaling to ~$3.8B in FY31 (procurement shown as 8 units in FY28 scaling to 12 then 27 in FY31), the program could incur a cumulative catch‑up charge of $60M–$110M dependent on LRIP timing (possible H2 2026 or H1 2027), and the planned separation of Industrial from A&D is targeted to complete in 12–18 months.Textron Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
78
Positive
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 15.19B | 14.80B | 13.70B | 13.68B | 12.87B | 12.38B |
| Gross Profit | 2.19B | 2.50B | 2.50B | 2.85B | 2.67B | 2.08B |
| EBITDA | 1.61B | 1.65B | 1.42B | 1.56B | 1.52B | 1.41B |
| Net Income | 934.00M | 921.00M | 824.00M | 921.00M | 861.00M | 746.00M |
Balance Sheet | ||||||
| Total Assets | 18.14B | 18.13B | 16.84B | 16.86B | 16.29B | 15.83B |
| Cash, Cash Equivalents and Short-Term Investments | 1.51B | 2.02B | 1.44B | 2.18B | 2.04B | 2.12B |
| Total Debt | 3.88B | 4.28B | 3.96B | 4.25B | 3.94B | 4.15B |
| Total Liabilities | 10.14B | 10.25B | 9.63B | 9.87B | 9.18B | 9.01B |
| Stockholders Equity | 8.00B | 7.88B | 7.20B | 6.99B | 7.11B | 6.82B |
Cash Flow | ||||||
| Free Cash Flow | 707.00M | 884.00M | 864.00M | 864.00M | 1.22B | 451.00M |
| Operating Cash Flow | 1.16B | 1.27B | 1.27B | 1.27B | 1.60B | 768.00M |
| Investing Cash Flow | -392.00M | -351.00M | -317.00M | -317.00M | -281.00M | -248.00M |
| Financing Cash Flow | -806.00M | -1.25B | -813.00M | -813.00M | -1.45B | 360.00M |
Textron Technical Analysis
Positive
91.61
Price Trends
93.45
Negative
91.00
Positive
86.30
Positive
Market Momentum
-0.24
Negative
51.99
Neutral
59.04
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TXT, the sentiment is Positive. The current price of 91.61 is above the 20-day moving average (MA) of 89.72, below the 50-day MA of 93.45, and above the 200-day MA of 86.30, indicating a neutral trend. The MACD of -0.24 indicates Negative momentum. The RSI at 51.99 is Neutral, neither overbought nor oversold. The STOCH value of 59.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TXT.
Textron Risk Analysis
Textron disclosed 25 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 (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $93.91B | 21.10 | 17.41% | 1.73% | 9.35% | 10.49% | |
73 Outperform | $16.19B | 17.63 | 12.25% | 0.09% | 9.48% | 18.21% | |
67 Neutral | $79.48B | 27.70 | 28.05% | 1.55% | 4.95% | 26.05% | |
66 Neutral | $56.30B | 32.48 | 8.87% | 1.61% | 5.79% | 9.31% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
61 Neutral | $118.57B | 23.12 | 74.53% | 2.77% | 4.59% | -10.76% | |
53 Neutral | $181.25B | -10,177.67 | -8719.23% | ― | 32.74% | ― |
* Industrials Sector Average
TXT
Textron
93.09
20.94
29.02%
BA
Boeing
229.93
38.23
19.94%
GD
General Dynamics
347.27
80.20
30.03%
LHX
L3Harris Technologies
302.20
87.49
40.75%
LMT
Lockheed Martin
514.26
52.35
11.33%
NOC
Northrop Grumman
559.60
82.89
17.39%
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.