ITW Stock Analysis — Illinois Tool Works
Sector: Industrials
AI Verdict
ITW trades at 23.8x next year's earnings for 10.7% growth, so you're paying a premium the numbers don't yet support unless its niche moat keeps margins unusually high.
Competitive Moat
Illinois Tool Works owns a portfolio of specialized industrial businesses with high switching costs due to proprietary manufacturing processes and deep customer integration. Its decentralized operating model and focus on niche markets allow it to maintain pricing power and resilience against competitors.
Summary
ITW's forward P/E of 23.8x and 10.7% expected EPS growth put it at a premium to typical industrials, spotlighting its defensible margins.
Where It Stands
ITW is up 8.85% over the past year, trades at 23.8x next year's earnings (above the 20x sector median), and sits at an RSI of 58.4, signaling a neutral momentum zone.
Key Metrics
- RSI: 58.4 — Neutral
- Trailing P/E: 26.4x
- Forward P/E: 23.8x
- PEG Ratio: 2.30
- Earnings Growth: +0.1%
- Revenue Growth: +0.0%
- Market Cap: $82.9B
- Dividend Yield: 0.02%
- 1-Year Return: 8.85%
- 52-Week High: $303.16
- 52-Week Low: $238.82
Analyst Consensus
2 Buy · 13 Hold · 9 Sell (24 analysts)
Bull Case
Analysts expect 10.7% EPS growth next year, which is above average for industrials, supporting the premium 23.8x forward P/E.
Bear Case
If the P/E reverts to the 20x sector median, the stock would lose roughly 16%, and the 2.30 trailing PEG signals you're paying up for modest growth.
Catalyst to Watch
Quarterly earnings beats or misses versus the 10.7% EPS growth consensus will determine if the premium is justified.