Textron Inc. (TXT)
Industrials · NYQ · US
Fundamentals
Valuation and ratings
Textron Inc. trades at USD90.64, which is 41% below the USD127.86 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.
Our moat model scores it 42 out of 100, which is little in the way of a moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 17.1 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Textron Inc.
Textron Inc. operates in the aircraft, defense, industrial, and finance businesses worldwide. It operates in six segments: Textron Aviation, Bell, Textron Systems, Industrial, Textron eAviation, and Finance. The Textron Aviation segment manufactures, sells, and services business jets, turboprop and piston engine aircraft, and military trainer and defense aircraft, as well as offers maintenance, inspection, and repair services; commercial parts; and advanced flight training devices. The Bell segment supplies military and commercial helicopters, tiltrotor aircraft, and related spare parts and services. The Textron Systems segment offers unmanned aircraft systems, electronic systems and solutions, advanced marine crafts, piston aircraft engines, live military air-to-air and air-to-ship training, weapons and related components, and armored and specialty vehicles. The Industrial segment offers blow-molded solutions, including conventional plastic fuel tanks and pressurized fuel tanks; plastic tanks for catalytic reduction systems and other fuel system components; lightweight and composite pentatonic battery systems for use in electric vehicles primarily to automobile original equipment manufacturers; and golf cars, off-road utility vehicles, powersports products, light transportation vehicles, aviation ground support equipment, professional turf-maintenance equipment, and turf-care vehicles to golf courses and resorts, government agencies and municipalities, consumers, outdoor enthusiasts, and commercial and industrial users. The Textron eAviation segment manufactures and sells light aircraft and gliders with electric and combustion engines; and provides other research and development initiatives related to sustainable aviation solutions. The Finance segment offers financing services to purchase new and pre-owned aviation aircraft and Bell helicopters. Textron Inc. was founded in 1923 and is headquartered in Providence, Rhode Island.
TXT passes 4 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
9 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Cliff Asness, AQR CAPITAL MANAGEMENT LLC$487.90M · 0.2% of book
- Two Sigma, TWO SIGMA INVESTMENTS, LP$157.62M · 0.1% of book
- D. E. Shaw, D. E. Shaw & Co., Inc.$77.82M · 0.1% of book
- Arrowstreet Capital, ARROWSTREET CAPITAL, LIMITED PARTNERSHIP$54.80M · 0.0% of book
- Joel Greenblatt, Gotham Asset Management, LLC$35.39M · 0.1% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Textron Inc. (TXT) undervalued?
Against our discounted cash flow estimate of USD127.86, TXT at USD90.64 is 41% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own TXT?
9 of the institutions we track reported a position in TXT in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is TXT's P/E ratio?
TXT trades at 17.1 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for TXT, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.