Textron Earnings Preview: What to Expect

Rhode Island-based Textron Inc. (TXT), with a market cap of $16.3 billion, is a global conglomerate that manufactures aircraft manufacturing, automotive components, and industrial tools. The company is expected to announce its fiscal Q2 earnings results on Thursday, July 18.

Ahead of the event, analysts expect TXT to report a profit of $1.51 per share, up 3.4% from $1.46 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in three of the past four quarters while missing on one other occasion.

Textron reported an adjusted EPS of $1.20 in the latest quarter, reflecting a 14.3% year over year increase driven by sustained market demand. However, this figure fell short of the consensus estimate by 6.3%.

For fiscal 2024, Wall Street expects Textron to report EPS of $6.27, up 12.2% from $5.59 in fiscal 2023. For fiscal 2025, the company’s EPS is projected to rise 10.1% annually to $6.90.

TXT stock has surged 26.8% over the past 52 weeks, outperforming the S&P 500 Index's ($SPX) 23.8% gains and the S&P 500 Industrial Sector SPDR’s (XLI) 13% returns over the same time frame.

Despite outperforming the broader market, TXT stock closed down more than 9% on April 25 after it released its Q1 earnings results. The company failed to beat its top-line and bottom-line estimates. Additionally, Textron delivered 36 jets in the quarter, up slightly from 35 in the year-ago quarter, but saw a decline in commercial turboprops, delivering 20 compared to 34 in the same period last year.

In Q1, the company incurred $14 million in special charges under its 2023 restructuring plan, primarily attributed to headcount reductions. Textron anticipates additional severance costs amounting to between $25 million and $30 million in the second quarter of 2024. Additionally, Textron experienced decreased consumer demand for certain products within its Specialized Vehicles division and lower demand for fuel systems from European automotive manufacturers in Q1.

The consensus opinion on Textron stock is moderately bullish, with a "Moderate Buy" rating. Among 13 analysts covering the stock, eight recommend a "Strong Buy," four suggest a "Hold," and the remaining one advises a “Strong Sell.”

The average analyst price target for TXT is $99.73, suggesting a potential upside of 16.3% from the current price levels.

More Stock Market News from Barchart

On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

Read news from 100’s of titles, curated specifically for you.

Already a member? Sign in here