In our view, Illinois Tool Works is a consultative manufacturing firm that invents long-term solutions for its customers’ most painful problems. It explicitly operates in markets where it can differentiate itself and where customers prioritize product performance over price.
ITW’s long-term incentive plan is based partially on the company’s return on invested capital, a metric we think encourages management to grow the business responsibly and efficiently.
ITW’s growth profile has not meaningfully improved from a decade ago, a period during which ITW’s organic top line grew below GDP.
|
Metric
|
ITW
|
DD
|
TT
|
|---|---|---|---|
Price/Earnings (Normalized) | 25.45 | 14.45 | 35.91 |
Price/Book Value | 24.15 | 1.36 | 12.25 |
Price/Sales | 4.86 | 2.43 | 4.93 |
Price/Cash Flow | 21.78 | 29.08 | 29.99 |
|
Metric
|
ITW
|
DD
|
TT
|
|---|---|---|---|
Quick Ratio | 0.79 | 1.15 | 0.66 |
Current Ratio | 1.19 | 2.68 | 1.10 |
Interest Coverage | 14.46 | 0.96 | 17.22 |
|
Metric
|
ITW
|
DD
|
TT
|
|---|---|---|---|
Return on Assets (Normalized) | 19.93% | 4.38% | 13.92% |
Return on Equity (Normalized) | 99.03% | 6.95% | 36.37% |
Return on Invested Capital (Normalized) | 27.97% | 5.69% | 24.48% |
|
1-Day Chart
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Morningstar Rating for Stocks
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United States