Illinois Tool Works Inc. Earnings Cheat Sheet: Revenue Strengthens Again by Double-Digits

S&P 500 (NYSE:SPY) component Illinois Tool Works Inc. (NYSE:ITW) reported its results for the third quarter. Illinois Tool Works 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 Third Quarter

Results: Net income for Illinois Tool Works Inc. rose to $507.6 million ($1.04 per share) vs. $422 million (84 cents per share) in the same quarter a year earlier. This marks a rise of 20% from the year earlier quarter.

Revenue: Rose 16% to $4.58 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: ITW reported adjusted net income of $1 per share. By that measure, the company beat the mean estimate of 98 cents per share. Analysts were expecting revenue of $4.56 billion.

Quoting Management: “Our financial performance in the third quarter was helped by solid growth in both our total revenues and our organic revenues,” said David B. Speer, chairman and chief executive officer. “Overall, end market demand in the quarter was essentially in line with second quarter levels and our forecast expectations. We also generated strong free operating cash flow in the quarter, allowing us to continue to have a well balanced capital allocation approach around dividends, acquisitions and share repurchase.”

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 14.4%, with the biggest boost coming in the first quarter when revenue rose 21.7% from the year earlier quarter.

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 18.5% and in the first quarter, the figure rose more than twofold.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of 96 cents versus a mean estimate of net income of $1.02 per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 95 cents a share to 90 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $3.94 a share to $3.74 over the last ninety days.

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)