Textron Inc (TXT): Today's Featured Aerospace/Defense Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Textron ( TXT) pushed the Aerospace/Defense industry lower today making it today's featured Aerospace/Defense laggard. The industry as a whole closed the day down 0.5%. By the end of trading, Textron fell 31 cents (-1.2%) to $25 on light volume. Throughout the day, two million shares of Textron exchanged hands as compared to its average daily volume of 2.9 million shares. The stock ranged in price between $24.98-$25.59 after having opened the day at $25.47 as compared to the previous trading day's close of $25.31. Other companies within the Aerospace/Defense industry that declined today were: Ducommun ( DCO), down 3.2%, Aerosonic Corporation ( AIM), down 3.1%, Astronics Corporation ( ATRO), down 2.7%, and Esterline Technologies ( ESL), down 2.7%.
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Textron Inc. operates in the aircraft, defense, industrial, and finance businesses worldwide. Its Cessna segment manufactures business jets, single engine utility turboprops, single engine piston aircraft, lift solutions, and parts, as well as maintenance, inspection, and repair services. Textron has a market cap of $7.21 billion and is part of the industrial goods sector. The company has a P/E ratio of 18, above the average aerospace/defense industry P/E ratio of 17.8 and above the S&P 500 P/E ratio of 17.7. Shares are up 38.8% year to date as of the close of trading on Tuesday. Currently there are nine analysts that rate Textron a buy, no analysts rate it a sell, and three rate it a hold.

TheStreet Ratings rates Textron as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the aerospace/defense industry could consider iShares DJ US Aerospace & Def Idx ( ITA) while those bearish on the aerospace/defense industry could consider ProShares Short Dow 30 ( DOG).

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