Shares of the Providence, R.I.-based light aircraft and industrial company hit a 52-week high of $28.98 on Monday. The stock's 52-week low of $14.66 was set on Aug. 26.Textron's stock trades at a forward P/E of 12.29X; the average for aerospace companies is 13.42X. For comparison, United Technologies and Boeing (BA) both have higher forward P/Es of 12.53X and 13.33X. Ten of the 16 analysts who cover Textron rate it at buy. Five analysts rate the stock at hold and one gives it a sell rating. Analyst comment: Of the joint venture between the company's Cessna unit and Aviation Industry Corporation of China, Deutsche Bank analysts wrote in a March 23 report. "Positives of the deal include the obvious access to China markets through local manufacturing, the potential for lower cost (or at least more local to use) manufacturing on a platform(s) to be co‐produced in China, and the sharing of development burden for a new bizjet (which be larger than what Cessna currently offers and incremental to the Cessna line‐up). The obvious risk is the establishment of another competitor (of which Cessna would have minority control) in the business/general aviation market that is to some extent already over‐subscribed." TheStreet Ratings gives Textron a C+ grade and hold rating.
Sturm Ruger Shares of Southport, Conn.-based gun maker hit a 52-week high Monday of $51.33. The stock's 52-week low of $18.65 was set on June 16. Sturm Ruger shares trade at a forward P/E of 17.84X; the average for defense companies is 13.03X. Two of the three analysts who cover Sturm Ruger rate it at buy; one analyst rates it at hold. Analyst comment: "We continue to believe that the major categories benefiting from strong demand are concealed carry/personal protection along with the tactical rifle category," KeyBanc Capital Markets analysts wrote in a March 21 report. "We maintain our BUY rating on SWHC and our HOLD ratings on RGR and CAB." TheStreet Ratings gives Sturm Ruger an A+ grade with a buy rating and $63.46 price target.
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