Zacks Investment Research upgraded shares of Illinois Tool Works (NYSE:ITW) from a sell rating to a hold rating in a report published on Monday, September 17th.
According to Zacks, “We believe that Illinois Tool Works will gain from its product portfolio, rising demand for products and enterprise strategies. Also, sound capital allocation policy will work in the company's favor. In August, the quarterly dividend rate was hiked by 28% and $3 billion share buyback program has been authorized. For 2018, the company anticipates organic sales growth to be 3-4% while total revenue is predicted to grow 4-5%. On the other hand, earnings guidance has been lowered to $7.50-$7.70 per share range due to 12 cents of adverse forex impact predicted for the second half of the year. Also, operating margin projection has been lowered to 24-25% on account of margin dilution estimated from price/costs. Also, weak cash positions and huge debt levels can be detrimental to the company's financials. In the past three months, the company's shares have underperformed the industry.”
Other equities research analysts also recently issued reports about the company. Robert W. Baird decreased their price objective on Illinois Tool Works from $155.00 to $141.00 and set a hold rating for the company in a report on Tuesday, July 24th. MED downgraded Illinois Tool Works from a buy rating to a hold rating and set a $152.00 price objective for the company. in a report on Thursday, July 12th. Citigroup set a $166.00 price objective on Illinois Tool Works and gave the company a buy rating in a report on Tuesday, July 24th. ValuEngine raised Illinois Tool Works from a sell rating to a hold rating in a report on Tuesday, September 4th. Finally, Goldman Sachs Group reissued a neutral rating on shares of Illinois Tool Works in a report on Tuesday, July 24th. Two analysts have rated the stock with a sell rating, thirteen have given a hold rating and five have assigned a buy rating to the company’s stock. Illinois Tool Works has a consensus rating of Hold and a consensus target price of $159.53.
Illinois Tool Works (NYSE:ITW) last announced its quarterly earnings results on Monday, July 23rd. The industrial products company reported $1.97 EPS for the quarter, meeting the Thomson Reuters’ consensus estimate of $1.97. The company had revenue of $3.83 billion for the quarter, compared to analyst estimates of $3.85 billion. Illinois Tool Works had a net margin of 12.70% and a return on equity of 56.74%. The firm’s revenue was up 6.4% on a year-over-year basis. During the same period in the prior year, the firm posted $1.69 earnings per share. As a group, research analysts expect that Illinois Tool Works will post 7.63 earnings per share for the current fiscal year.
Illinois Tool Works announced that its board has approved a share repurchase plan on Friday, August 3rd that allows the company to repurchase $3.00 billion in shares. This repurchase authorization allows the industrial products company to buy up to 6.4% of its shares through open market purchases. Shares repurchase plans are typically an indication that the company’s board believes its shares are undervalued.
The firm also recently announced a quarterly dividend, which was paid on Tuesday, October 9th. Shareholders of record on Friday, September 28th were issued a $1.00 dividend. The ex-dividend date was Thursday, September 27th. This represents a $4.00 dividend on an annualized basis and a yield of 3.06%. This is an increase from Illinois Tool Works’s previous quarterly dividend of $0.78. Illinois Tool Works’s dividend payout ratio (DPR) is 60.70%.
In other Illinois Tool Works news, Director Richard H. Lenny bought 1,778 shares of Illinois Tool Works stock in a transaction on Friday, July 27th. The stock was bought at an average price of $140.85 per share, with a total value of $250,431.30. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. 0.82% of the stock is currently owned by company insiders.
Institutional investors have recently added to or reduced their stakes in the business. BlackRock Inc. increased its position in Illinois Tool Works by 4.3% during the 1st quarter. BlackRock Inc. now owns 21,382,129 shares of the industrial products company’s stock worth $3,349,722,000 after purchasing an additional 874,197 shares in the last quarter. Northern Trust Corp increased its position in Illinois Tool Works by 0.3% during the 1st quarter. Northern Trust Corp now owns 15,232,668 shares of the industrial products company’s stock worth $2,386,349,000 after purchasing an additional 40,022 shares in the last quarter. Bank of America Corp DE increased its position in Illinois Tool Works by 1.6% during the 2nd quarter. Bank of America Corp DE now owns 5,875,087 shares of the industrial products company’s stock worth $813,935,000 after purchasing an additional 93,269 shares in the last quarter. JPMorgan Chase & Co. increased its position in Illinois Tool Works by 8.0% during the 1st quarter. JPMorgan Chase & Co. now owns 5,834,431 shares of the industrial products company’s stock worth $914,023,000 after purchasing an additional 431,414 shares in the last quarter. Finally, Bank of New York Mellon Corp increased its position in Illinois Tool Works by 1.1% during the 2nd quarter. Bank of New York Mellon Corp now owns 3,972,642 shares of the industrial products company’s stock worth $550,369,000 after purchasing an additional 44,036 shares in the last quarter. 76.09% of the stock is owned by institutional investors.
About Illinois Tool Works
Illinois Tool Works Inc manufactures and sells industrial products and equipment worldwide. It operates through seven segments: Automotive OEM; Food Equipment; Test & Measurement and Electronics; Welding; Polymers & Fluids; Construction Products; and Specialty Products. The Automotive OEM segment offers plastic and metal components, fasteners, and assemblies for automobiles, light trucks, and other industrial uses.
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