Textron Analysts Slash Forecasts After Weak Revenue

Textron Inc. (TXT) shares fell 3.4% to close at $78.41 on Wednesday, following the release of its fourth-quarter 2024 earnings results. The company reported adjusted earnings per share (EPS) of $1.34, surpassing the consensus expectation of $1.28 by 4.7%. However, revenue reached $3.613 billion, slightly missing the expected $3.748 billion. Despite certain segmental headwinds, Textron ended the quarter on a positive note.



Analysts have revised their forecasts for Textron following the earnings announcement. Morgan Stanley analyst Kristine Liwag maintained Textron with an Equal-Weight rating but lowered the price target from $86 to $82. Baird analyst Peter Arment maintained Textron with an Outperform rating but lowered the price target from $100 to $92. These changes reflect a slightly more cautious market sentiment towards Textron, as analysts have reduced their price targets despite maintaining their ratings.



The revised analyst forecasts have implications for the company's stock price. The reduction in price targets suggests that analysts expect the stock to perform worse than previously anticipated. This could lead to a decrease in investor confidence and potentially lower demand for the stock, putting downward pressure on the stock price. However, the fact that analysts have maintained their ratings indicates that they still see some value in the company and are not expecting a significant decline in its fundamentals.

In light of the recent labor disruptions at Textron Aviation, the company may need to address these issues and restore productivity to pre-strike levels. To do this, Textron could consider negotiating with labor unions, implementing a gradual ramp-up plan, focusing on employee training and development, investing in automation and technology, strengthening communication and collaboration, and monitoring and analyzing key performance indicators (KPIs).



In conclusion, Textron's weak revenue performance in the fourth quarter of 2024 has led to revised analyst forecasts, reflecting a slightly more cautious market sentiment. The company must address labor disruptions and restore productivity to pre-strike levels to ensure long-term growth and resilience. Investors should closely monitor Textron's progress in navigating these challenges and maintaining its competitive edge.