Is Textron (TXT) Stock Undervalued Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is Textron (TXT). TXT is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 13.62, while its industry has an average P/E of 20.31. TXT's Forward P/E has been as high as 17.68 and as low as 11.81, with a median of 13.90, all within the past year.
Investors should also note that TXT holds a PEG ratio of 1.16. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. TXT's PEG compares to its industry's average PEG of 1.77. Over the past 52 weeks, TXT's PEG has been as high as 1.40 and as low as 0.98, with a median of 1.16.
We should also highlight that TXT has a P/B ratio of 2.13. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.94. Over the past year, TXT's P/B has been as high as 2.27 and as low as 1.78, with a median of 2.12.
Finally, investors should note that TXT has a P/CF ratio of 11.26. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. TXT's P/CF compares to its industry's average P/CF of 19.40. Over the past 52 weeks, TXT's P/CF has been as high as 12.70 and as low as 10.21, with a median of 11.73.
These are only a few of the key metrics included in Textron's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, TXT looks like an impressive value stock at the moment.
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Textron Inc. (TXT) : Free Stock Analysis Report
