Textron (TXT – Research Report), the Industrials sector company, was revisited by a Wall Street analyst on January 24. Analyst Peter Arment from Robert W. Baird remains neutral on the stock and has a $89.00 price target.
Peter Arment’s Buy rating for Textron (TXT) is influenced by a combination of positive indicators and growth expectations. These include a robust backlog in the business jet sector, anticipated revenue increases from the Future Long-Range Assault Aircraft (FLRAA) program, and projected unit delivery growth. Furthermore, Arment anticipates that Textron Aviation will maintain a book-to-bill ratio exceeding 1.0x in 2024, signaling a healthy order environment particularly in the domestic business jet market. The strength in this market is supported by sustained demand for Turboprops internationally. In addition, a significant portion of the Aviation segment’s revenue is expected to come from the Commercial Aftermarket, which is forecasted to continue growing at a steady pace.
Additional factors bolstering the Buy rating include record commercial helicopter deliveries by Bell in the fourth quarter of 2023 and the prediction of further growth in this area for 2024. The Bell segment is expected to see double-digit top-line growth, driven by both commercial deliveries and a significant increase in FLRAA revenues. Despite anticipating limited growth in the TXT Systems for 2024, there is potential for expansion moving into 2025 and beyond with key development awards on the horizon. With these considerations, along with an upward adjustment of Textron’s EPS estimates for 2024, Arment’s outlook for the company is optimistic, warranting a Buy recommendation.
In another report released yesterday, Citi also maintained a Buy rating on the stock with a $104.00 price target.
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Based on the recent corporate insider activity of 24 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of TXT in relation to earlier this year.
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Textron (TXT) Company Description:
Textron, Inc. is a multi-industry company, which leverages global network of aircraft, defense, industrial, and finance businesses to provide customers innovative solutions and services. The company operates its business through the following segments: Textron Aviation, Bell, Textron Systems, Industrial, and Finance. The Textron Aviation segment manufactures sells, and services Beechcraft and Cessna aircraft. The Bell segment supplies military and commercial helicopters, tiltrotor aircraft, and related spare parts. The Textron Systems segment product lines consist of unmanned aircraft systems; land and marine systems; weapons and sensors; and a variety of defense and aviation mission support products and services. The Industrial segment designs and manufactures a variety of products under the Golf; Turf Care and Light Transportation Vehicles; Fuel Systems and Functional Components and Powered Tools; and Testing and Measurement Equipment product lines. The Finance segment consists of Textron Financial Corp. and its consolidated subsidiaries, which provides finances primarily to purchasers of new Cessna aircraft and Bell helicopters. The company founded by Royal Little in 1923 and is headquartered in Providence, RI.
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