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Are Investors Undervaluing Textron (TXT) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Textron (TXT - Free Report) is a stock many investors are watching right now. TXT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 12.85, which compares to its industry's average of 19.27. TXT's Forward P/E has been as high as 15.03 and as low as 12.47, with a median of 13.60, all within the past year.
Investors should also note that TXT holds a PEG ratio of 1.28. 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 1.69. Over the past 52 weeks, TXT's PEG has been as high as 1.49 and as low as 1.11, with a median of 1.26.
Investors should also recognize that TXT has a P/B ratio of 2.39. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 4.46. TXT's P/B has been as high as 2.70 and as low as 2.06, with a median of 2.38, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TXT has a P/S ratio of 1.2. This compares to its industry's average P/S of 1.87.
Finally, investors should note that TXT has a P/CF ratio of 12.84. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. TXT's P/CF compares to its industry's average P/CF of 30.42. Within the past 12 months, TXT's P/CF has been as high as 14.45 and as low as 11.02, with a median of 12.73.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Textron is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TXT feels like a great value stock at the moment.
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Are Investors Undervaluing Textron (TXT) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Textron (TXT - Free Report) is a stock many investors are watching right now. TXT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 12.85, which compares to its industry's average of 19.27. TXT's Forward P/E has been as high as 15.03 and as low as 12.47, with a median of 13.60, all within the past year.
Investors should also note that TXT holds a PEG ratio of 1.28. 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 1.69. Over the past 52 weeks, TXT's PEG has been as high as 1.49 and as low as 1.11, with a median of 1.26.
Investors should also recognize that TXT has a P/B ratio of 2.39. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 4.46. TXT's P/B has been as high as 2.70 and as low as 2.06, with a median of 2.38, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. TXT has a P/S ratio of 1.2. This compares to its industry's average P/S of 1.87.
Finally, investors should note that TXT has a P/CF ratio of 12.84. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. TXT's P/CF compares to its industry's average P/CF of 30.42. Within the past 12 months, TXT's P/CF has been as high as 14.45 and as low as 11.02, with a median of 12.73.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Textron is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TXT feels like a great value stock at the moment.