Will Segmental Sales Aid Textron's (TXT) Earnings in Q3?
Textron Inc. TXT is scheduled to report its third-quarter 2023 results on Oct 26 before market open.
Textron has a four-quarter earnings surprise of 12.99%, on average. Solid revenue performance across the majority of its business segments is likely to have contributed to the overall performance of the company in the third quarter of 2023.
Textron Aviation, a Key Contributor to Revenues
Solid demand for jets and turboprops, along with higher pricing, is likely to have benefited Textron Aviation’s revenue performance in the third quarter. The Zacks Consensus Estimate for this segment’s revenues in the third quarter is pegged at $1,378.7 million, indicating an improvement of 18.1% from revenues reported in the year-ago quarter.
Bell’s Performance May Remain Solid
The ramp-up of the FLRAA program and higher pricing are anticipated to bolster the Bell unit’s revenue performance in the third quarter of 2023.
The Zacks Consensus Estimate for the Bell segment’s revenues in the third quarter is pegged at $849.7 million, indicating growth of 12.7% from revenues reported in the year-ago quarter.
Textron Systems’ Revenues to Remain Robust
Higher volumes from all its programs must have added impetus to Textron Systems’ revenue performance in the third quarter of 2023.
The Zacks Consensus Estimate for Textron System’s revenues in the third quarter is pegged at $309.6 million, suggesting an increase of 6% reported in the year-ago quarter.
Industrial Unit to Show Strength
Higher volumes in Specialized Vehicles and Kautex are likely to have continued to lift this segment’s performance in the soon-to-be-reported quarter.
The Zacks Consensus Estimate for Industrial’s third-quarter revenues is pegged at $889 million, indicating an improvement of 4.7% from the year-ago quarter.
Q3 Estimates
The expected robust revenue performance in the majority of its business segments must have boosted the overall top line in the third quarter. The Zacks Consensus Estimate for third-quarter revenues is pegged at $3.45 billion, suggesting a rise of 12.1% from the year-ago quarter.
A strong top line, along with the favorable impact of pricing, is likely to have boosted the company’s bottom line in the third quarter of 2023.
The Zacks Consensus Estimate for third-quarter earnings is pegged at $1.27 per share. This calls for an improvement of 19.8% from the prior-year reported figure.
Backlog Projections Suggest Growth
The strong demand for its products can be gauged by its backlog strength. In this context, our model suggests Textron’s backlog to increase by 11.4% to $14.75 billion in the third quarter of 2023.
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Textron Inc. Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for TXT this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
Textron has an Earnings ESP of -4.07% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are three defense companies you may want to consider as these have the right combination of elements to post an earnings beat this season:
L3Harris Technologies, Inc. LHX has an Earnings ESP of +0.86% and a Zacks Rank #3. The long-term earnings growth rate of LHX is 2.99%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for L3Harris’ third-quarter earnings, pegged at $3.07 per share, indicates a decline of 5.8% from the prior-year reported figure. The Zacks Consensus Estimate for LHX’s sales suggests a growth rate of 13.7% from the prior-year reported figure.
Northrop Grumman NOC has an Earnings ESP of +1.48% and a Zacks Rank #3. NOC delivered a four-quarter average earnings surprise of 4.38%.
The Zacks Consensus Estimate for NOC’s third-quarter sales is pegged at $9.67 billion, suggesting a growth rate of 7.8% from the prior-year reported figure. The Zacks Consensus Estimate for its third-quarter earnings stands at $5.81 per share.
General Dynamics Corporation GD has an Earnings ESP of +0.73% and a Zacks Rank #3. It delivered an earnings surprise of 2.99% in the last four quarters, on average.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $9.94 billion, suggesting a 0.4% decline from the year-ago quarter. The Zacks Consensus Estimate for third-quarter earnings is pegged at $2.87 per share, indicating a decline of 11.9% from the prior-year reported figure.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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
Northrop Grumman Corporation (NOC) : Free Stock Analysis Report
General Dynamics Corporation (GD) : Free Stock Analysis Report
Textron Inc. (TXT) : Free Stock Analysis Report
L3Harris Technologies Inc (LHX) : Free Stock Analysis Report
