Illinois Tool Works (ITW) – Investment Analysts’ Recent Ratings Changes

Illinois Tool Works (NYSE: ITW) has recently received a number of price target changes and ratings updates:

  • 7/2/2018 – Illinois Tool Works was downgraded by analysts at ValuEngine from a “hold” rating to a “sell” rating.
  • 7/2/2018 – Illinois Tool Works was downgraded by analysts at Zacks Investment Research from a “buy” rating to a “hold” rating. According to Zacks, “We believe that Illinois Tool Works is well positioned to gain from its solid product portfolio, strengthening foothold in end markets and strategic initiatives to improve margins. Also, the policy of rewarding shareholders handsomely will work in the company's favor. For 2018, the company increased its earnings guidance from $7.45-$7.65 to $7.60-$7.80 per share. Organic sales growth is expected to be 3-4%, while operating margin will likely be within 25-25.5%. However, the company is exposed to headwinds arising from global market uncertainties. Also, weak cash positions and a highly leveraged balance sheet can be detrimental to the financials. Also, net price/cost impact might adversely impact margins in the second quarter. In the past three months, the company's shares have underperformed the industry while its earnings estimates for both 2018 and 2019 remained stable in the past 60 days.”
  • 6/27/2018 – Illinois Tool Works is now covered by analysts at Wolfe Research. They set an “underperform” rating on the stock.
  • 6/27/2018 – Illinois Tool Works was upgraded by analysts at Zacks Investment Research from a “hold” rating to a “buy” rating. They now have a $158.00 price target on the stock. According to Zacks, “We believe that Illinois Tool Works is well positioned to gain from its solid product portfolio, strengthening foothold in end markets and strategic initiatives to improve margins. Also, the policy of rewarding shareholders handsomely will work in the company’s favor. For 2018, the company increased its earnings guidance from $7.45-$7.65 to $7.60-$7.80 per share. Organic sales growth is expected to be 3-4%, while operating margin will likely be within 25-25.5%. Earnings estimates on the company have increased for both 2018 and 2019 in the past 60 days. However, the company the company's shares have underperformed the industry in the past three months.”

Shares of Illinois Tool Works traded up $4.06, hitting $143.70, during trading hours on Monday, according to MarketBeat. The company had a trading volume of 1,276,300 shares, compared to its average volume of 1,535,452. Illinois Tool Works Inc. has a 52-week low of $135.07 and a 52-week high of $179.07. The firm has a market cap of $47.30 billion, a PE ratio of 21.81, a P/E/G ratio of 1.78 and a beta of 1.24. The company has a debt-to-equity ratio of 1.65, a current ratio of 2.20 and a quick ratio of 1.74.

Illinois Tool Works (NYSE:ITW) last released its quarterly earnings data on Thursday, April 26th. The industrial products company reported $1.90 EPS for the quarter, topping the consensus estimate of $1.86 by $0.04. Illinois Tool Works had a return on equity of 51.79% and a net margin of 12.36%. The company had revenue of $3.74 billion during the quarter, compared to the consensus estimate of $3.69 billion. During the same period last year, the company earned $1.54 EPS. Illinois Tool Works’s revenue for the quarter was up 7.9% on a year-over-year basis. sell-side analysts anticipate that Illinois Tool Works Inc. will post 7.78 EPS for the current year.

The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, July 11th. Investors of record on Friday, June 29th will be issued a $0.78 dividend. The ex-dividend date of this dividend is Thursday, June 28th. This represents a $3.12 annualized dividend and a yield of 2.17%. Illinois Tool Works’s payout ratio is 47.34%.

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. BlackRock Inc. grew its stake in shares of Illinois Tool Works by 4.3% during the 1st quarter. BlackRock Inc. now owns 21,382,129 shares of the industrial products company’s stock valued at $3,349,722,000 after purchasing an additional 874,197 shares during the period. Northern Trust Corp grew its stake in shares of Illinois Tool Works by 0.3% during the 1st quarter. Northern Trust Corp now owns 15,232,668 shares of the industrial products company’s stock valued at $2,386,349,000 after purchasing an additional 40,022 shares during the period. JPMorgan Chase & Co. grew its stake in shares of Illinois Tool Works by 8.0% during the 1st quarter. JPMorgan Chase & Co. now owns 5,834,431 shares of the industrial products company’s stock valued at $914,023,000 after purchasing an additional 431,414 shares during the period. Massachusetts Financial Services Co. MA grew its stake in shares of Illinois Tool Works by 5.7% during the 1st quarter. Massachusetts Financial Services Co. MA now owns 5,528,000 shares of the industrial products company’s stock valued at $866,016,000 after purchasing an additional 298,220 shares during the period. Finally, OppenheimerFunds Inc. grew its stake in shares of Illinois Tool Works by 8,692.7% during the 1st quarter. OppenheimerFunds Inc. now owns 1,234,588 shares of the industrial products company’s stock valued at $193,410,000 after purchasing an additional 1,220,547 shares during the period. Institutional investors own 77.02% of the company’s stock.

Illinois Tool Works Inc manufactures and sells industrial products and equipment worldwide. It operates through seven segments: Automotive OEM; Food Equipment; Test & Measurement and Electronics; Welding; Polymers & Fluids; Construction Products; and Specialty Products. The Automotive OEM segment offers plastic and metal components, fasteners, and assemblies for automobiles, light trucks, and other industrial uses.

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