Textron Inc. Hits a 52-Week High - Analyst Blog

On April 3, 2014, shares of Textron Inc. TXT reached a new 52-week high of $40.65. Shares gained almost 40.9% in the past one-year period. Average volume of shares traded over the last three months came in at 2,194,540.

Textron, a Zacks Rank #3 (Hold) stock, delivered positive earnings surprises in two of last four quarters. In the fourth quarter of 2013, operating earnings of 60 cents per share surpassed the Zacks Consensus Estimate by 1.69% and increased 20.0% from the year-ago level.

For full-year 2014, the company expects operating earnings in the range of $2.00 to $2.20 per share while the Zacks Consensus Estimate for full-year 2014 is pegged at $2.15 per share, showing a year-over-year improvement of 22.71%.

The company continues to invest in new products. In 2014, the company expects top-line growth of about 20% and 18.5% from its Textron System and Cessna segments respectively, on the back of new programs. The company expects 2014 operating revenues to be around $13.2 billion, an estimated 9.0% climb from $12.1 billion reported in 2013.

Recently, the company announced its plan to acquire all outstanding equity interests in Beech Holdings, LLC (“Beech Holdings”) for about $1.4 billion in cash. This was the third acquisition deal signed by Textron in the final quarter of 2013. This acquisition will help to maintain its steady inorganic growth strategy.

Textron is focused on the Latitude, Longitude, Relentless, Jet Ranger replacement, UAS, Scorpion, and other high profile programs. The year 2013 was important for the company as it introduced and made investments in a number of new projects. Investor focus in 2014 would be on the potential synergies to be derived from these investments.

Other Stock to Consider

Other better-ranked stocks in defense and aerospace include Huntington Ingalls Industries, Inc. HII, Wesco Aircraft Holdings, Inc. WAIR and Raytheon Co. RTN. While Huntington Ingalls and Wesco Aircraft carry a Zacks Rank #1 (Strong Buy), Raytheon holds a Zacks Rank #2 (Buy).