Textron Inc Stock Fair Value – Textron: A 50% Undervalued Industrial Buyback Star
December 23, 2023
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Textron Inc ($NYSE:TXT). is an industrial conglomerate with a portfolio of businesses in aerospace, defense, industrial, and finance markets. In addition to its robust manufacturing and engineering capabilities, Textron is well-known for its share buyback program. As a result, the stock may be significantly undervalued by as much as 50%, making it an attractive buyback opportunity. Textron is a diversified company with a broad portfolio of businesses in a variety of markets. Its aerospace segment includes Bell Helicopter and Cessna Aircraft Company; its defense segment includes AAI Corporation; its industrial segment includes Global Industrial Technologies and Textron Systems; its finance segment includes Textron Financial Corporation. With this broad array of businesses across multiple industries, Textron has proven itself to be resilient through challenging economic cycles. Textron’s share buyback program has been a driving factor behind the company’s performance and its ability to remain competitive in the market.
The reduction in the share count has had a positive effect on the company’s per-share earnings, leading to increased investor confidence in the stock. As a result, Textron may be significantly undervalued by as much as 50%, making it an attractive buyback opportunity for investors. For investors looking for a potentially undervalued industrial stock, Textron may be an attractive buyback opportunity. With its strong portfolio of businesses and its aggressive share buyback program, Textron has the potential to generate significant returns for long-term investors. As such, Textron could offer investors an opportunity to capitalize on a potentially 50% undervalued industrial stock.
Analysis – Textron Inc Stock Fair Value
At GoodWhale, we have conducted an analysis of TEXTRON INC‘s financials. Our proprietary Valuation Line suggests that the fair value of TEXTRON INC’s share is around $78.0. Currently, the stock is trading at $80.1, which is a fair price but slightly overvalued by 2.7%. This indicates that investors should consider buying the stock at the current market prices, but remain mindful of the slight industry-wide overvaluation. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Textron Inc. More…
| Total Revenues | Net Income | Net Margin |
| 13.43k | 949 | 7.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Textron Inc. More…
| Operations | Investing | Financing |
| 1.24k | -317 | -1.11k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Textron Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 16.49k | 9.43k | 36.06 |
Key Ratios Snapshot
Some of the financial key ratios for Textron Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 3.8% | 20.2% | 8.9% |
| FCF Margin | ROE | ROA |
| 6.4% | 10.6% | 4.5% |
Peers
The competition between Textron Inc and its competitors is intense. Each company is vying for market share and customer loyalty. They are all fighting for the same thing: to be the best in the industry. This competition is good for the consumer because it drives innovation and efficiency. It also keeps prices down.
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Optex Systems Holdings Inc is a publicly traded company that designs, manufactures, and sells optical sighting and surveillance products for military, law enforcement, and commercial applications. The company has a market capitalization of $18.39 million and a return on equity of 2.52%. Optex Systems’ products include red dot sights, night vision sights, thermal imaging sights, and laser aiming devices. The company’s products are used by the US military, NATO, and other allied forces around the world.
– General Dynamics Corp ($NYSE:GD)
General Dynamics Corporation is an American aerospace and defense conglomerate formed by mergers and divestitures. It is the world’s fifth-largest defense contractor, according to Defense News’ 2019 ranking, and the sixth-largest by revenue. The company ranked No. 98 in the 2018 Fortune 500 list of the largest United States corporations by total revenue. It is headquartered in Reston, Virginia.
General Dynamics’ main business units are Aerospace, Combat Systems, Information Technology, Mission Systems, and Marine Systems. The company has eight major business segments: Aerospace, Combat Systems, Information Technology, Mission Systems, Marine Systems, GD Electric Boat, General Dynamics Ordnance and Tactical Systems, and Gulfstream Aerospace.
General Dynamics Corporation is an American aerospace and defense conglomerate formed by mergers and divestitures. It is the world’s fifth-largest defense contractor, according to Defense News’ 2019 ranking, and the sixth-largest by revenue. The company ranked No. 98 in the 2018 Fortune 500 list of the largest United States corporations by total revenue. It is headquartered in Reston, Virginia.
General Dynamics’ main business units are Aerospace, Combat Systems, Information Technology, Mission Systems, and Marine Systems. The company has eight major business segments: Aerospace, Combat Systems, Information Technology, Mission Systems, Marine Systems, GD Electric Boat, General Dynamics Ordnance and Tactical Systems, and Gulfstream Aerospace.
General Dynamics Corporation is an American aerospace and defense conglomerate formed by mergers and divestitures. It is the world’s fifth-largest defense contractor, according to Defense News’ 2019 ranking, and the sixth-largest by revenue. The company ranked No. 98 in the 2018 Fortune 500 list of the largest United States corporations by total revenue. It is headquartered in Reston, Virginia.
General Dynamics’ main business units are Aerospace, Combat Systems, Information Technology, Mission Systems, and Marine Systems. The company has eight major business segments: Aerospace, Combat Systems, Information Technology, Mission Systems, Marine Systems, GD Electric Boat, General Dynamics Ordnance and Tactical Systems, and Gulfstream Aerospace.
– Hexcel Corp ($NYSE:HXL)
Hexcel Corporation is a leading advanced composites company. They develop, manufacture and market lightweight, high-performance structural materials, including carbon fibers, reinforcements, prepregs, honeycomb, matrix systems, adhesives and composite structures, used in commercial aerospace, space and defense, and industrial applications.
Hexcel’s market cap is 4.72B as of 2022. The company has a Return on Equity of 6.26%.
Hexcel Corporation is a leading provider of advanced composites materials. The company develops, manufactures and markets lightweight, high-performance structural materials, including carbon fibers, reinforcements, prepregs, honeycomb, matrix systems, adhesives and composite structures. Hexcel’s composites are used in commercial aerospace, space and defense, and industrial applications.
Summary
Textron Inc. is an industrial company exhibiting strong buyback potential. Its current stock price is undervalued by up to 50%, offering investors an attractive entry point. The company has a healthy balance sheet with a low debt-to-equity ratio. It also has a strong history of consistent cash flow generation, supporting its dividend and buyback programs.
Textron’s strong profitability and good cash flow are likely to increase further in the future, due to its wide array of products and services in the aerospace, industrial, and defense sectors. Investors should consider Textron’s attractive stock price and sound fundamentals to take advantage of what could be a lucrative long-term investment opportunity.
