Shares of Illinois Tool Works ( ITW) and Black & Decker ( BDK) climbed Tuesday after the toolmakers each posted fourth-quarter earnings that topped recently reduced forecasts.

Illinois Tool Works reported a profit of $439.3 million, or 77 cents a share, on revenue of $3.64 billion. A year earlier, the company earned $400.6 million, or 71 cents a share, on $3.25 billion in revenue.

In December, the Glenview, Ill., company slashed its earnings forecast to 72 cents to 74 cents a share from its earlier view of 77 cents to 81 cents. At the time, the company warned of soft demand in a number of North American end markets.

The company said Tuesday that it had strong contributions from international units, which helped drive earnings growth.

Analysts polled by Thomson Financial projected earnings of 73 cents a share and revenue of $3.61 billion.

Looking ahead, Illinois Tool Works forecast first-quarter earnings of 69 cents to 73 cents a share and full-year earnings of $3.27 to $3.39 a share.

Analysts predict first-quarter earnings of 71 cents a share and 2007 earnings of $3.30 a share.

Separately, Black & Decker said it earned $95.7 million, or $1.38 a share, in the fourth quarter. Late last year, the company projected earnings of $1.30 to $1.35 a share, well below analysts' estimate of $1.86 at the time.

Analysts' most recent forecast called for earnings of $1.32 a share.

Black & Decker reported revenue of $1.61 billion, exceeding Wall Street's forecast of $1.57 billion.

In the 2005 fourth quarter, the Towson, Md., company recorded earnings from continuing operations of $151 million, or $1.90 a share, on revenue of $1.73 billion.

"As we announced in December, Black & Decker faced a weak demand environment and inventory reductions by customers during the fourth quarter," said Chairman and CEO Nolan Archibald in a statement. "While demand remained sluggish, order rates stabilized somewhat at the end of the quarter, and we slightly exceeded our revised forecast for sales and earnings per share."

Looking ahead, Black & Decker forecast first-quarter earnings of $1.25 to $1.30 a share, ahead of the $1.24 a share that analysts project. For the full year, the company sees earnings of $6.25 to $6.55 a share. Analysts project earnings of $6.50 a share.

Shares of Black & Decker recently were up $3, or 3.6%, to $86.14. Illinois Tool Works jumped $3.62, or 7.7%, to $50.53.

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