Illinois Tool Works Tops Q1 Earnings Estimates, Reaffirms '25 View

Illinois Tool Works Inc. ITW reported first-quarter 2025 adjusted earnings of $2.38 per share, which surpassed the Zacks Consensus Estimate of $2.34. However, earnings decreased 2.5% year over year.Illinois Tool’s revenues of $3,839 million narrowly missed the consensus estimate of $3,842 million. The top line declined 3.4% year over year due to an unfavorable foreign currency translation of 1.8%. Also, organic sales decreased 1.6%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)ITW’s Segmental PerformanceTest & Measurement and Electronics’ revenues were down 6.3% year over year to $652 million. Our estimate for segmental revenues was $687.8 million. Revenues from Automotive Original Equipment Manufacturer decreased 3.7% year over year to $786 million. Our estimate for segmental revenues was $772.8 million.Food Equipment generated revenues of $627 million, down 0.7% year over year. Our estimate for segmental revenues was $629.3 million. Welding revenues were $472 million, down 0.9% year over year. Our estimate for segmental revenues was $465.1 million.Construction Products’ revenues were down 9.2% year over year to $443 million. Our estimate for segmental revenues was $453.8 million. Revenues of $435 million from Specialty Products reflected a decrease of 1% year over year. Our estimate for segmental revenues was $445.6 million. Polymers & Fluids’ revenues of $429 million declined 0.8% year over year. Our estimate for segmental revenues was $422 million.Illinois Tool Works Inc. Price, Consensus and EPS Surprise Illinois Tool Works Inc. price-consensus-eps-surprise-chart | Illinois Tool Works Inc. QuoteIllinois Tool’s Margin ProfileIllinois Tool’s cost of sales increased 0.7% year over year to $2.16 billion. Selling, administrative and research and development expenses increased 4.4% year over year to $706 million. The operating margin was 24.8%, down 60 basis points (bps) from the year-ago quarter. Enterprise initiatives contributed 120 bps to the operating margin.ITW’s Balance Sheet and Cash FlowAt the end of the first quarter, Illinois Tool had cash and equivalents of $873 million compared with $948 million at the end of December 2024. Long-term debt was $7.28 billion compared with $6.31 billion at the end of December 2024.In the first three months of 2025, Illinois Tool generated net cash of $592 million from operating activities, reflecting an increase of 0.5% from the year-ago number. Capital spending on the purchase of plant and equipment was $96 million, up 1% year over year. Free cash flow was $496 million, up 0.4% year over year.Illinois Tool’s 2025 GuidanceIllinois Tool reaffirmed its full-year 2025 financial guidance. ITW expects earnings to be in the range of $10.15-$10.55 per share. Revenues and organic revenues are expected to increase 0-2%. Operating margin is expected to be 26.5–27.5%. Enterprise initiatives are expected to contribute approximately 100 bps to the operating margin.Illinois Tool projects free cash flow to be more than 100% of net income. The company expects to repurchase about $1.5 billion worth of shares. The effective tax rate is expected to be around 24%.ITW’s Zacks RankThe company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Some better-ranked companies are discussed below:Griffon Corporation GFF currently sports a Zacks Rank of 1. GFF delivered a trailing four-quarter average earnings surprise of 14.7%. In the past 60 days, the consensus estimate for Griffon’s fiscal 2025 (ending September 2025) earnings has increased 2.9%.Insteel Industries, Inc. IIIN currently carries a Zacks Rank #2 (Buy). IIIN delivered a trailing four-quarter average earnings surprise of 122.4%. In the past 60 days, the Zacks Consensus Estimate for Insteel Industries’ fiscal 2025 earnings has increased 34.8%.Energy Recovery ERII presently carries a Zacks Rank of 2. ERII delivered a trailing four-quarter average earnings surprise of 161.6%. In the past 60 days, the consensus estimate for Energy Recovery’s 2025 earnings has increased 1.3%.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Illinois Tool Works Inc. (ITW): Free Stock Analysis Report Insteel Industries, Inc. (IIIN): Free Stock Analysis Report Energy Recovery, Inc. (ERII): Free Stock Analysis Report Griffon Corporation (GFF): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks