Textron Inc. TXT is scheduled to release fourth-quarter 2024 results on Jan. 22, before market open.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The company has a four-quarter average negative earnings surprise of 0.61%. The declining revenue performance across two of its major business segments is likely to have impacted Textron’s overall top-line performance. Moreover, charges related to its restructuring plan are likely to have hurt earnings.
Labor Strike at Textron Aviation Likely to Have Impacted Revenues
The labor strike at Textron Aviation unit that started in the third quarter, caused by the expiration of its labor agreement with the International Association of Machinists (IAM), and ended in October 2024 is expected to have affected its fourth-quarter revenues. Although production and deliveries recovered after the strike ended, the four-week work stoppage at the Wichita facilities is likely to have disrupted this unit’s jet and turboprop deliveries. As a result, revenues from this segment are expected to be lower than the prior year quarter.
The Zacks Consensus Estimate for this segment’s revenues is pegged at $1,452.8 million, which indicates a decline of 4.7% from the year-ago quarter.
Factors Likely to Have Influenced Bell’s Performance
Higher military sales volumes, backed by the continued ramp-up of the FLRAA program, are projected to have bolstered the Bell unit’s revenue performance.
Moreover, the Bell unit successfully delivered a Bell 505 to the Fort Worth Police Department in the fourth quarter. Such deliveries are expected to have boosted this segment’s top line.
However, a lower volume of the V-22 program is likely to have adversely impacted this segment’s overall revenues to some extent. The Zacks Consensus Estimate for the Bell segment’s revenues is pegged at $1,101 million, which indicates growth of 2.8% from the year-ago quarter.
Textron Systems’ Revenues
Higher pricing is likely to have provided some support to Textron System’s revenue performance, partially offset by lower sales volumes from some of its major programs.
The Zacks Consensus Estimate for Textron System’s revenues is pegged at $317 million, which implies a rise of 0.9% from the year-ago quarter.
Industrial Unit’s Performance
Lower volumes from the specialized vehicles product line are likely to have impacted TXT’s Industrial segment’s performance.
The Zacks Consensus Estimate for the Industrial segment’s revenues is pegged at $850.4 million, which indicates a decline of 11.5% from the year-ago quarter.
TXT’s Q4 Estimates
The dismal revenue performance in two of its business segments is likely to have adversely impacted TXT’s overall top line. The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $3.74 billion, which indicates a decline of 3.8% from the year-ago quarter’s figure.
A declining top line is likely to have impacted the bottom line. Moreover, special charges related to the company’s earlier announced restructuring plan to further reduce operating expenses through headcount reductions are expected to have hurt its overall earnings performance.
The Zacks Consensus Estimate for TXT’s earnings is pegged at $1.28 per share. This indicates a decline of 20% from the prior-year figure.
TXT’s Backlog Projections
Our model indicates Textron’s backlog to increase 17.4% to $16.31 billion.
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Textron Inc. Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for TXT this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here, as you will see below.
Earnings ESP: Textron has an Earnings ESP of -5.21%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: TXT currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
Below we have mentioned the following players from the same sector that have the right combination of elements to beat on earnings in the upcoming releases.
Leidos Holdings, Inc. LDOS is set to report fourth-quarter 2024 earnings on Feb. 11, 2025, before market open. It has an Earnings ESP of +12.08% and a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for LDOS’ earnings is pegged at $2.18 per share. The consensus estimate for its sales is pegged at $4.12 billion, indicating year-over-year growth of 3.6%.
Northrop Grumman Corporation NOC is set to report its fourth-quarter 2024 results on Jan. 30, before market open. It has an Earnings ESP of +1.36% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for NOC’s earnings is pegged at $6.26 per share. The consensus estimate for its sales is pegged at $11.02 billion, indicating year-over-year growth of 3.6%.
CurtissWright CW is set to report its fourth-quarter results on Feb. 12, after market close. It has an Earnings ESP of +1.29% and a Zacks Rank of 3 at present.
The Zacks Consensus Estimate for CW’s earnings is pegged at $3.08 per share. The consensus estimate for its sales is pegged at $785.5 million.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
