Value
7.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.6 |
| P/S | 9.7 |
| EV/EBITDA | 5.5 |
| Fwd P/E | 9.0 |
| PEG | 7.5 |
| Analyst target | 5.0 |
- ▸Forward P/E: 12.1x
- ▸PEG: 0.91
- ▸Attractively valued
TXT · Why this verdict
Why Textron (TXT) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score5.6/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Textron has delivered four consecutive quarterly earnings beats and sports strong price momentum above all moving averages, but with the stock trading above the analyst consensus target and a put/call ratio of 2.45 signaling elevated hedging demand, the near-term upside is exhausted.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
At the current price of $93.75, the stock sits 0.7% above the analyst consensus price target of $93.11, leaving no margin of safety and flipping the asymmetry ratio to -0.11. Targets | Analyst consensus target rises above $105, restoring at least 12% upside from current levels. | ↓Deteriorating |
| CounterAnalyst targets lag price action in high-momentum names and could be revised upward following strong upcoming quarterly results in 37 days. | ||
Textron has beaten analyst earnings estimates in all four of the last four quarters with an average positive surprise of 6.6%, demonstrating consistent execution in its aerospace and defense business. Earnings | The beat streak extends to at least 6 of 8 quarters and average surprise remains above 3% over the next year. | ↑Improving |
| CounterWith a forward price-to-earnings ratio of 12.8x and a PEG of 1.21, earnings upside may already be priced in, limiting the incremental value of further beats. | ||
Textron trades above its 200-day moving average with strong MACD and rising on-balance volume, reflecting broad-based buying interest that has pushed the stock into a breakout pattern. Momentum breakdown | Price sustains above the 200-day moving average and on-balance volume continues to rise over the next 12 months. | Tripped↑Improving |
| CounterThe stock is already above the analyst price target by 0.7%, meaning momentum buyers may find no fundamental anchor to support further advances. | ||
The options market shows a put/call ratio of 2.45 and implied volatility of 61%, indicating that institutional traders are paying substantial premiums to hedge against a significant downside move. Options | Put/call ratio falls below 1.5 within 6 months as hedging demand normalizes after the earnings catalyst. | ↑Improving |
| CounterElevated put/call ratios can be contrarian bullish signals if they reflect excessive fear rather than informed bearish positioning. | ||
At the current price of $93.75, the stock sits 0.7% above the analyst consensus price target of $93.11, leaving no margin of safety and flipping the asymmetry ratio to -0.11.
↓DeterioratingTargets
- Expectation
- Analyst consensus target rises above $105, restoring at least 12% upside from current levels.
CounterAnalyst targets lag price action in high-momentum names and could be revised upward following strong upcoming quarterly results in 37 days.
Textron has beaten analyst earnings estimates in all four of the last four quarters with an average positive surprise of 6.6%, demonstrating consistent execution in its aerospace and defense business.
↑ImprovingEarnings
- Expectation
- The beat streak extends to at least 6 of 8 quarters and average surprise remains above 3% over the next year.
CounterWith a forward price-to-earnings ratio of 12.8x and a PEG of 1.21, earnings upside may already be priced in, limiting the incremental value of further beats.
Textron trades above its 200-day moving average with strong MACD and rising on-balance volume, reflecting broad-based buying interest that has pushed the stock into a breakout pattern.
Tripped↑ImprovingMomentum breakdown
- Expectation
- Price sustains above the 200-day moving average and on-balance volume continues to rise over the next 12 months.
CounterThe stock is already above the analyst price target by 0.7%, meaning momentum buyers may find no fundamental anchor to support further advances.
The options market shows a put/call ratio of 2.45 and implied volatility of 61%, indicating that institutional traders are paying substantial premiums to hedge against a significant downside move.
↑ImprovingOptions
- Expectation
- Put/call ratio falls below 1.5 within 6 months as hedging demand normalizes after the earnings catalyst.
CounterElevated put/call ratios can be contrarian bullish signals if they reflect excessive fear rather than informed bearish positioning.
Per-dimension breakdown
Quality
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.0 |
| ROA | 3.0 |
| Gross margin | 0.0 |
| Op margin | 3.5 |
| Net margin | 3.1 |
| Current ratio | 6.6 |
| FCF quality | 3.9 |
| Moat | 5.0 |
| Piotroski F | 8.9 |
- ▸Earnings quality RED FLAG: 48% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
3.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.2 |
| EPS growth | 3.0 |
Momentum
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 2.1 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 10.0 |
| vol acceleration | 8.9 |
- ▸Overbought bear rally (RSI 84)
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -1.8%/30d — confirmed downtrend
- ▸Volume surge (2.4x avg) on up move
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.5 |
| Analyst rating | 7.3 |
| Price target | 7.0 |
Insider
6.5/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 7.4 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.6 |
| quality rank | 5.3 |
| growth rank | 0.2 |
- ▸Attractive P/E vs peers
Technical
2.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 1.4 |
| 52w position | 7.2 |
| gap | 3.0 |
- ▸Extreme gap up (8.9%) - may pull back
Risk (lower is worse)
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.5 |
| days to cover | 6.7 |
| volatility | 6.0 |
| put call | 0.0 |
| implied vol | 7.1 |
| max pain risk | 7.0 |
| beta | 7.6 |
| debt equity | 7.9 |
- ▸Elevated put/call: 29.41
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| surprise avg | 7.4 |
| dividend safety | 6.8 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +2 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+2Passed (7)
- MOMENTUM:7.8>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.2<1.5@spot
Warning (1)
- DEATH_CROSS:momentum=7.8>=5.0 recovering
Reward-to-Risk
0.16
Upside
+2.4%
Downside
15.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 84
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 7.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.2<1.5@spot) reinforce the read. Current asymmetry R:R is 0.16 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 7.8, Catalyst at 7.4, and Value at 7.3; the weakest are Technical at 2.9, Growth at 3.1, and Quality at 4.2. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 0.16 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Four Quarter Beat Streak
Trip ifEarnings surprise falls below 0% in at least 2 of the next 4 quarters, breaking the perfect beat streak.
- P2Momentum Above All MasTripped
Trip ifPrice drops below $89, more than 5% below the current $93.75, with the 200-day moving average acting as resistance rather than support.
- P3Elevated Put Call Hedging
Trip ifPut/call ratio rises above 3.0, indicating hedging demand has increased by more than 20% from current elevated levels.
- P4Target Exhausted No Upside
Trip ifAnalyst consensus price target falls below $88, implying downside greater than 6% from the current price of $93.75.