Textron Drifting, As Its Main Drivers Now Are Outside Of Its Control

Wall Street isn’t a sentimental place, but I can empathize if Textron (NYSE:TXT) management and investors are a little frustrated with the circumstances around this aviation company. Supply chain issues are preventing the company from producing Cessna bizjets at targeted rates, while the wait goes on for a major military award that will play a significant role in the future of the company’s helicopter business.

These shares have fallen almost 10% since my last update, underperforming the broader industrial space and other aerospace-leveraged names like General Dynamics (GD), Honeywell (HON), and Lockheed Martin (LMT), and only doing a little better than Boeing (BA). I do have some concerns that expectations for the bizjet cycle are getting too bullish, but I believe Textron can still generate long-term revenue growth in the neighborhood of 5% and the shares look more interesting on that basis, but there’s above-average risk here right now.

 

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Textron Drifting, As Its Main Drivers Now Are Outside Of Its Control