Illinois Tool Works (NYSE:ITW) Lowered to “Sell” at Zacks Investment Research

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Zacks Investment Research cut shares of Illinois Tool Works (NYSE:ITW) from a hold rating to a sell rating in a report published on Tuesday morning, Zacks.com reports. They currently have $154.00 price objective on the industrial products company’s stock.

According to Zacks, “We believe that Illinois Tool will likely gain from a diversified business structure, enterprise initiatives and skilled management team. For 2019, the company anticipates earnings per share of $7.90-$8.20, up 4-8% year over year. Enterprise strategy is anticipated to boost margins by 100 basis points (bps). The company remains committed to rewarding shareholders handsomely through dividend payments and share buybacks. For 2019, share buybacks are likely to amount $1.5 billion. However, organic sales are predicted to increase 0.5-2.5%, down from previously mentioned 1-3%. Also, high tax rate and unfavorable foreign exchange that will lower earnings by 6 cents in the second quarter remain concerns. In the past three months, the company's shares have underperformed the industry. Earnings estimates for 2019 have declined in the past 60 days.”

Several other brokerages have also commented on ITW. UBS Group set a $133.00 price objective on shares of LHC Group and gave the stock a buy rating in a report on Friday, May 10th. Morgan Stanley set a $10.00 price objective on shares of Ford Motor and gave the stock a hold rating in a report on Friday, April 26th. Citigroup set a $221.00 price objective on shares of 3M and gave the stock a buy rating in a report on Friday, April 26th. JPMorgan Chase & Co. restated a hold rating and issued a $137.00 price objective on shares of Continental in a report on Friday, April 26th. Finally, Argus upped their price objective on shares of Waste Management from $110.00 to $115.00 and gave the stock a buy rating in a report on Friday, April 26th. Five research analysts have rated the stock with a sell rating, twelve have given a hold rating and two have given a buy rating to the stock. The stock presently has an average rating of Hold and a consensus target price of $140.53.

ITW stock opened at $151.48 on Tuesday. The company has a current ratio of 1.53, a quick ratio of 1.19 and a debt-to-equity ratio of 1.87. Illinois Tool Works has a one year low of $117.75 and a one year high of $158.69. The stock has a market cap of $49.35 billion, a PE ratio of 19.93, a PEG ratio of 2.41 and a beta of 1.24. The business has a 50 day moving average of $148.07.

Illinois Tool Works (NYSE:ITW) last released its quarterly earnings results on Thursday, April 25th. The industrial products company reported $1.81 EPS for the quarter, topping the Zacks’ consensus estimate of $1.80 by $0.01. Illinois Tool Works had a net margin of 17.21% and a return on equity of 72.74%. The business had revenue of $3.55 billion during the quarter, compared to analysts’ expectations of $3.64 billion. During the same quarter in the previous year, the company earned $1.90 EPS. The business’s quarterly revenue was down 5.1% compared to the same quarter last year. On average, sell-side analysts forecast that Illinois Tool Works will post 7.9 earnings per share for the current fiscal year.

The business also recently declared a quarterly dividend, which was paid on Wednesday, July 10th. Stockholders of record on Friday, June 28th were issued a dividend of $1.00 per share. This represents a $4.00 dividend on an annualized basis and a dividend yield of 2.64%. The ex-dividend date was Thursday, June 27th. Illinois Tool Works’s payout ratio is presently 52.63%.

In other news, EVP John R. Hartnett sold 14,323 shares of the stock in a transaction that occurred on Thursday, May 2nd. The shares were sold at an average price of $153.55, for a total value of $2,199,296.65. Following the transaction, the executive vice president now owns 31,695 shares in the company, valued at approximately $4,866,767.25. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, VP Randall J. Scheuneman sold 14,931 shares of the stock in a transaction that occurred on Friday, June 7th. The stock was sold at an average price of $150.17, for a total transaction of $2,242,188.27. Following the completion of the transaction, the vice president now owns 21,603 shares in the company, valued at approximately $3,244,122.51. The disclosure for this sale can be found here. Company insiders own 0.87% of the company’s stock.

Large investors have recently modified their holdings of the company. Geode Capital Management LLC raised its stake in shares of Illinois Tool Works by 6.2% in the fourth quarter. Geode Capital Management LLC now owns 3,925,119 shares of the industrial products company’s stock valued at $496,400,000 after acquiring an additional 227,625 shares during the last quarter. Norges Bank bought a new stake in Illinois Tool Works during the 4th quarter worth about $402,071,000. Legal & General Group Plc lifted its position in Illinois Tool Works by 6.5% during the 4th quarter. Legal & General Group Plc now owns 1,734,504 shares of the industrial products company’s stock worth $219,642,000 after buying an additional 105,237 shares in the last quarter. Parametric Portfolio Associates LLC raised its holdings in shares of Illinois Tool Works by 3.8% in the 1st quarter. Parametric Portfolio Associates LLC now owns 1,287,199 shares of the industrial products company’s stock valued at $184,752,000 after purchasing an additional 47,529 shares during the period. Finally, Coho Partners Ltd. raised its holdings in shares of Illinois Tool Works by 4.0% in the 1st quarter. Coho Partners Ltd. now owns 1,233,253 shares of the industrial products company’s stock valued at $177,009,000 after purchasing an additional 47,382 shares during the period. Hedge funds and other institutional investors own 77.45% of the company’s stock.

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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