Textron Inc. TXT
Textron trades at a 24% P/E discount to the peer median (15.2x vs. 20.0x) and a 21% EV/EBITDA discount (10.98x vs. 13.98x), with FY2025 EPS up 18% to $5.11 and operating income surging 46% to $1.25B on 8% revenue growth — yet the stock has fallen to $80.56, below both its 50-day ($88.50) and 200-day ($90.08) moving averages, with RSI at 33 signaling oversold conditions. The appointment of a new Textron Aviation CEO effective August 31 and the milestone 500th CJ4 delivery offer near-term catalysts, while operating income growth demonstrates cost discipline despite gross margin compression from 20.8% in FY2023 to 16.9% in FY2025.
The combination of deep valuation discount, oversold technicals, and demonstrated operating leverage creates an asymmetric risk/reward at current levels.
What could go wrong
- Gross margin compression. Gross profit was flat at $2.5B despite 8% revenue growth in FY2025, compressing gross margin to 16.9% from 20.8% in FY2023 — if input costs or mix continue to deteriorate, the operating leverage thesis weakens.
- Technical downtrend. Stock trades at $80.56, below both MA50 ($88.50) and MA200 ($90.08), with negative MACD histogram (-0.44) — the downtrend may persist despite oversold RSI of 33.
- Smart money outflows. Smart money score has fallen to 0.0029 as of 2026-06-30 from 0.0184 in Q1 2026, with fund count declining from 59 to 55 — institutional conviction is fading.
- Insider net selling. Over the trailing 24 months, insiders were net sellers of 57,552 shares worth approximately $14.9M, including a May 2026 sale by director Clark at $93.09 per share.
What would change my mind
Where this comes from: peer_relative · peer_relative · fundamentals FY2025 & FY2024; derived_metrics FY2025 · derived_metrics FY2025 & FY2023; fundamentals FY2025. Orin's read on TXT; not advice.
Twelve months actual closes to 2026-09-24 · actual filings
50-day average 200-day average · volume below
On file
All TXT filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Fmr | $1.5B | 0.1% of fund |
| Vanguard Capital Management | $1.0B | 0.0% of fund |
| State Street | $901.9M | 0.0% of fund |
| Invesco | $781.0M | 0.1% of fund |
| Vanguard Portfolio Management | $678.1M | 0.0% of fund |
| Geode Capital Management | $480.6M | 0.0% of fund |
78 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 77 Form 4 filings, net −$14.9M. Of the 50 on hand, 1 was an open-market purchase and 7 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about TXT
Orin answers questions about TXT from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 14.3× | 17.6× | 44.5× |
| EV/EBITDA | 9.1× | 11.7× | — |
| P/S | 0.85× | 1.17× | — |
| P/B | 1.6× | 2.1× | — |
Its P/E sits below all 5 of the last 5 years (−2.06σ from its own mean).
3.6%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $0.9B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$97
$95 – $98 · +26% against today's price
- 13 buy or overweight
- 16 hold
- 0 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| TXTTextron Inc. | $13B | 14.3× | 9.1× | 16.5% | 6.1% | 12% |
| ALLEAllegion plc | $13B | 19.9× | 14.7× | 44.8% | 15.4% | 32% |
| AVYAvery Dennison Corporation | $13B | 18.5× | 12.0× | 29.0% | 7.6% | 31% |
| CSLCarlisle Companies Incorporated | $13B | 17.9× | 11.9× | 35.3% | 14.2% | 41% |
| HIIHuntington Ingalls Industries, Inc. | $10B | 15.8× | 12.0× | 12.6% | 5.0% | 13% |
| KTOSKratos Defense & Security Solutions, Inc. | $9B | 273.5× | 63.9× | 22.0% | 2.0% | 1% |
| MASMasco Corporation | $13B | 15.5× | 10.9× | 36.9% | 11.6% | -406% |
| WSOWatsco, Inc. | $13B | 27.7× | 18.1× | 27.9% | 6.5% | 17% |
| WWDWoodward, Inc. | $19B | 35.2× | 23.7× | 29.5% | 13.2% | 22% |
The median is of the 8 peers listed above and nothing else — check it against the column. This company trades 25.3% below it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $109 | $92.96 · +17% | 2026-06-10 |
| Levered DCF | $119 | $92.96 · +28% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.