U.S. Markets closed
  • S&P 500

    3,901.36
    +0.57 (+0.01%)
     
  • Dow 30

    31,261.90
    +8.77 (+0.03%)
     
  • Nasdaq

    11,354.62
    -33.88 (-0.30%)
     
  • Russell 2000

    1,773.27
    -2.96 (-0.17%)
     
  • Crude Oil

    110.35
    +0.46 (+0.42%)
     
  • Gold

    1,845.10
    +3.90 (+0.21%)
     
  • Silver

    21.87
    -0.03 (-0.13%)
     
  • EUR/USD

    1.0562
    -0.0026 (-0.2429%)
     
  • 10-Yr Bond

    2.7870
    -0.0680 (-2.38%)
     
  • Vix

    29.43
    +0.08 (+0.27%)
     
  • GBP/USD

    1.2496
    +0.0021 (+0.1674%)
     
  • USD/JPY

    127.8500
    +0.0560 (+0.0438%)
     
  • BTC-USD

    29,292.52
    -1,008.73 (-3.33%)
     
  • CMC Crypto 200

    650.34
    -23.03 (-3.42%)
     
  • FTSE 100

    7,389.98
    +87.24 (+1.19%)
     
  • Nikkei 225

    26,739.03
    +336.19 (+1.27%)
     

Illinois Tool (ITW) to Redeem Euro-Denominated Senior Notes

  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

Illinois Tool Works Inc. ITW yesterday announced that it plans to redeem €500 million worth of its senior notes. The redemption price has been set higher than the principal amount and the redemption date is fixed at Feb 22, 2022.

It is worth mentioning that Illinois Tool’s shares lost 1.3% yesterday, ending the trading session at $243.84.

Inside the Headlines

The to-be-redeemed notes carry a coupon rate of 1.750% and are due to expire this May. In second-quarter 2021, Illinois Tools reclassified the notes from its long-term debts to short term.

The redemption price for the notes has been set at the outstanding principal amount plus interest amount (accrued and unpaid). Post redemption, the company will no longer carry any outstanding 1.750% Euro-denominated senior notes.

The aforementioned redemption will help Illinois Tool lower its debt balance. Exiting the third quarter of 2021, the company’s long-term debt balance was $6,972 million, down 1.2% sequentially, and short-term debts were $579 million. In June 2021, it redeemed $350 million worth of 3.375% senior notes.

Notably, the company’s cash and cash equivalents were $2 billion at the end of third-quarter 2021. Funds from short-term credit facilities also add to the company’s liquidity.

Compared with the industry, Illinois Tool presently seems to be more leveraged. Its debt-to-equity and long-term debt to capital are at 199.6% and 66.6%, respectively. These are higher than the industry’s debt-to-equity of 66.3% and long-term debt to capital of 41.2%.

Zacks Rank, Estimate Trend and Price Performance

Illinois Tool has a market capitalization of $76.5 billion and a Zacks Rank #3 (Hold) at present. It stands to benefit from diversified businesses, acquired assets, and shareholder-friendly policies. Inflation in raw material costs and supply-chain restrictions are concerning.

The company’s shares have gained 9.2% in the past three months compared with the industry’s growth of 3.5%.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

In the past 60 days, the Zacks Consensus Estimate for its earnings has been increased by 0.8% to $9.15 per share for 2022. The same for the fourth quarter of 2021 and 2021 are pegged at $1.88 and $8.45, respectively. The company is slated to report its earnings results for the fourth quarter of 2021 on Feb 3, 2022, before market open.

Illinois Tool Works Inc. Price and Consensus

Illinois Tool Works Inc. Price and Consensus
Illinois Tool Works Inc. Price and Consensus

Illinois Tool Works Inc. price-consensus-chart | Illinois Tool Works Inc. Quote

Stocks to Consider

Three better-ranked stocks from the industry are mentioned below.

Ferguson plc’s FERG results in the last reported quarter were impressive, with an earnings beat of 16.82%. The company presently sports a Zacks Rank #1 (Strong Buy).

You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Ferguson’s earnings has increased 10.5% for fiscal 2022 (ending July 2022) in the past 60 days. FERG’s shares have gained 17.8% in the past three months.

Graco Inc. GGG presently carries a Zacks Rank #2 (Buy). The company’s earnings surprise in the last reported quarter was -10.94%. The same for the last four quarters was 6.58%, on average.

In the past 60 days, the Zacks Consensus Estimate for Graco’s earnings has increased 1.9% for 2022. GGG’s shares have rallied 4.3% in the past three months.

Alta Equipment Group Inc. ALTG reported weaker-than-expected results in the last reported quarter, with earnings lagging estimates by 50.00%. Its earnings surprise in the last four quarters was -38.62%, on average. The company presently carries a Zacks Rank #2.

The Zacks Consensus Estimate for Alta Equipment’s earnings has increased 5.3% for 2022 in the past 60 days. ALTG’s shares have rallied 8.3% in the past three months.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Illinois Tool Works Inc. (ITW) : Free Stock Analysis Report

Graco Inc. (GGG) : Free Stock Analysis Report

Alta Equipment Group Inc. (ALTG) : Free Stock Analysis Report

Wolseley PLC (FERG) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research