Illinois Tool Works Inc (ITW): Today's Featured Industrial Goods 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

Illinois Tool Works ( ITW) pushed the Industrial Goods sector lower today making it today's featured Industrial Goods laggard. The sector as a whole closed the day down 0.9%. By the end of trading, Illinois Tool Works fell $0.89 (-1.2%) to $70.04 on light volume. Throughout the day, 1,539,158 shares of Illinois Tool Works exchanged hands as compared to its average daily volume of 2,350,800 shares. The stock ranged in price between $69.58-$71.24 after having opened the day at $70.92 as compared to the previous trading day's close of $70.93. Other companies within the Industrial Goods sector that declined today were: Capstone Turbine Corporation ( CPST), down 7.0%, CVD Equipment Corporation ( CVV), down 6.7%, Real Goods Solar ( RSOL), down 6.5% and Chicago Rivet & Machine ( CVR), down 6.1%.
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Illinois Tool Works Inc. manufactures and sells a range of industrial products and equipment worldwide. Illinois Tool Works has a market cap of $31.6 billion and is part of the industrial industry. The company has a P/E ratio of 13.2, below the S&P 500 P/E ratio of 17.7. Shares are up 15.3% year to date as of the close of trading on Monday. Currently there are 9 analysts that rate Illinois Tool Works a buy, 1 analyst rates it a sell, and 7 rate it a hold.

TheStreet Ratings rates Illinois Tool Works as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins, solid stock price performance and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, China Valves Technology ( CVVT), down 16.7%, Highpower International ( HPJ), down 7.8%, Hydrogenics Corporation ( HYGS), down 6.7% and Industrial Services of America ( IDSA), down 5.7%.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the industrial goods sector could consider Industrial Select Sector SPDR ( XLI) while those bearish on the industrial goods sector could consider ProShares Short Dow 30 ( DOG).

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