Illinois Tool Works Inc. Earnings Cheat Sheet: Revenue Grows By Double-Digits For Fifth Straight Quarter

S&P 500 (NYSE:SPY) component Illinois Tool Works Inc. (NYSE:ITW) reported its results for the second quarter. Illinois Tool Works Inc. manufactures a range of industrial products and equipment for the automotive, construction, electronics, food/beverage, packaging, power system, decorative surfaces, and medical industries.

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Illinois Tool Works Earnings Cheat Sheet for the Second Quarter

Results: Net income for Illinois Tool Works Inc. rose to $498.4 million (99 cents per share) vs. $411.5 million (81 cents per share) in the same quarter a year earlier. This marks a rise of 21.1% from the year earlier quarter.

Revenue: Rose 17.5% to $4.61 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: ITW fell short of the mean analyst estimate of $1.02 per share. Analysts were expecting revenue of $4.69 billion.

Quoting Management: “While our second quarter performance reflected solid demand from a number of worldwide end markets, our 17.5 percent total revenue growth was slightly below our original expectations,” said David B. Speer, chairman and chief executive officer. “Both our total revenue and organic revenue growth rates in the second quarter were approximately 100 basis points lower than forecasted in April. We also anticipate similar moderating demand levels in the second half of 2011. As a result, we have modestly adjusted our third quarter revenue assumptions as well as our full-year earnings forecast. Nonetheless, we still believe overall end markets continue to be in a long-term recovery mode.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 15.6%, with the biggest boost coming in the first quarter when revenue rose 21.7% from the year earlier quarter.

Gross margin shrank 1.2 percentage points to 35.1%. The contraction appeared to be driven by increased costs, which rose 15.4% from the year earlier quarter while revenue rose 13.2%.

The company fell short of estimates last quarter after beating the mark the quarter before with net income of 91 cents versus a mean estimate of net income of 84 cents per share.

The company has now been profitable for the last nine quarters, and for the last five, profit has risen year over year by an average of 56.9%. The quarter with the biggest boost was the second quarter of the last fiscal year, which saw a more than twofold surge.

Competitors to Watch: Dover Corporation (NYSE:DOV), Nordson Corporation (NASDAQ:NDSN), Entegris, Inc. (NASDAQ:ENTG), Graco Inc. (NYSE:GGG), Flow International Corp. (NASDAQ:FLOW), 3M Company (NYSE:MMM), Myers Industries, Inc. (NYSE:MYE), Taylor Devices, Inc. (NASDAQ:TAYD), Core Molding Tech., Inc. (AMEX:CMT), and Pall Corporation (NYSE:PLL).

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(Source: Xignite Financials)