Textron Inc. TXT is a manufacturing titan in the aviation, automotive engine, and industrial tools space. The company’s robust product line, burgeoning backlog, and unwavering product demand paint a bright future for its performance.
Time to delve into the factors elevating this Zacks Rank #2 (Buy) stock into a solid investment opportunity at this moment.
Ascending Growth Projections & History of Positive Surprises
Textron anticipates a 11.7% long-term (three-to five-years) earnings growth. The Zacks Consensus Estimate for TXT’s 2023 earnings per share (EPS) stands at $5.45, showcasing a 2.8% uptick in the past 60 days.
The Zacks Consensus Estimate for 2023 sales is tagged at $13.76 billion, signaling a 6.9% upsurge from the 2022 reported figure.
TXT has delivered a trailing four-quarter average earnings surprise of 14.13%.
Healthy Debt Position and Financial Standing
At 33.32%, TXT boasts a favorable total debt-to-capital ratio compared to the industry’s 46.49%. This indicates a lighter debt burden compared to its peers, a clear indicator of stability.
TXT is equipped with a current ratio of 1.88, surpassing the industry average of 1.16. This indicates a robust financial capability to settle its short-term debt obligations.
Robust Backlog and Innovations Taking Flight
Textron’s products are in high demand, leading to a total backlog of $14.5 billion as of Sep 30, 2023, a significant rise from $13.3 billion as of Dec 31, 2022.
Highlights include the launch of the Cessna Citation CJ3 Gen2 and the Cessna Citation Ascend aircraft, as well as the ongoing development of the V-280 Valor and Bell 360 Invictus, demonstrating a commitment to innovation.
Riveting Return on Equity (ROE)
At 14.7%, TXT’s current ROE surpasses the industry’s average of 9.64%, indicating a more efficient capital utilization compared to its peers.
Impressive Stock Performance
Over the past year, TXT’s shares have surged by 10.7% contrary to the industry’s 7.8% decline.
Image Source: Zacks Investment Research
Explore Other High-Potential Stocks
Apart from TXT, other top-ranked stocks within the aeronautics sector are Leidos Holdings Inc. LDOS, Virgin Galactic Holdings, Inc. SPCE, and TransDigm Group Inc. TDG, all currently holding a Zacks Rank #2.
LDOS flaunts a solid long-term earnings growth rate of 8.1%, whereas SPCE stands strong with an impressive 40.3%. Meanwhile, TDG boasts a remarkable 21.1% growth rate.
Zacks Reveals ChatGPT “Sleeper” Stock
One little-known company is at the heart of an especially brilliant Artificial Intelligence sector. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion.
As a service to readers, Zacks is providing a bonus report that names and explains this explosive growth stock and 4 other “must buys.” Plus more.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.