Textron Inc. (TXT) DCF Valuation
TGM's two-stage DCF values Textron Inc. (TXT) between $62.38 and $120.13 depending on assumptions, with a base case of $85.62. Growth is taken from the company's own record (blend of 5-year revenue and FCF growth), fading to 2.5% long-run; the discount rate (8.7%) reflects its beta.
What would today's price require?
$86.54 is justified only if free cash flow grows about +6.3% a year (fading to 2.5% long-run) at a 8.7% required return — about in line with its track record.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 3.1%/yr | 9.7% | $62.38 |
| Base case | 6.1%/yr | 8.7% | $85.62 |
| Optimistic | 9.1%/yr | 7.7% | $120.13 |
| Analyst DCF (FMP) | independent reference — different model | $110.31 | |
Current Price
$86.54
Market-Implied Growth
+6.3%/yr
vs +7.0% 5Y actual
Model Scenario Range
$62.38 – $120.13
model output — not a price target
TXT DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for TXT (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $874.0M · 0.17B shares · net debt $1.9B
Estimated Fair Value
$98.34
+13.6% vs $86.54
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 6.1%/yr FCF growth and 10-year horizon fixed. Green = above today's $86.54; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 6.7% | $130 | $141 | $154 | $170 | $191 |
| 7.7% | $106 | $113 | $121 | $130 | $142 |
| 8.7% | $88.73 | $93.18 | $98.34 | $104 | $112 |
| 9.7% | $75.60 | $78.73 | $82.29 | $86.38 | $91.14 |
| 10.7% | $65.38 | $67.65 | $70.20 | $73.09 | $76.37 |
About Textron Inc.
Textron Inc. (TXT) is a diverse global enterprise with significant involvement in the aerospace, defense, industrial, and financial sectors. Its Textron Aviation division is responsible for the production, sale, and maintenance of a variety of aircraft, including corporate jets, turboprop and piston-engine planes, and military trainer and defense aircraft. This segment also delivers extensive maintenance, inspection, and repair services, alongside selling commercial aircraft components. The Bell segment stands as a primary provider of military and civilian helicopters, in addition to tiltrotor aircraft, supported by related spare parts and services. Textron Systems focuses on developing and supplying advanced unmanned aerial platforms, sophisticated electronic systems and solutions, specialized marine vessels, piston aircraft engines, realistic live military air-to-air and air-to-ship training systems, weaponry and associated components, and a range of armored and specialty vehicles. Within its Industrial segment, Textron creates specialized plastic fuel containment systems, including innovative pressurized versions designed for hybrid vehicles, clear-vision systems, and plastic tanks for catalytic reduction systems, primarily serving original equipment manufacturers (OEMs) in the automotive sector. This segment also manufactures a broad array of recreational and utility vehicles, such as golf carts, off-road vehicles (including ATVs and side-by-sides), snowmobiles, and light transportation solutions. Additionally, it produces specialized equipment for aviation ground support, as well as professional-grade turf management and landscaping machinery. Its varied customer base spans golf courses and resorts, government entities, municipalities, individual consumers, outdoor enthusiasts, and diverse commercial and industrial enterprises. Finally, the Finance segment extends financial services, facilitating the acquisition of new and pre-owned aircraft from Textron Aviation and Bell helicopters. Textron's operational footprint is worldwide, with a presence across the United States, Europe, Asia, Australia, and other international markets. The company, founded in 1923, maintains its corporate headquarters in Providence, Rhode Island.
- Sector
- Industrials
- Industry
- Aerospace & Defense
- CEO
- Lisa Atherton