Illinois Tool Works Inc.

Valuation Analysis

About the Company

Illinois Tool Works Inc. provides industrial products and equipment in North America, Europe, the Middle East, Africa, the Asia Pacific, and South America. It operates through seven segments: Automotive OEM; Food Equipment; Test & Measurement and Electronics; Welding; Polymers & Fluids; Construction Products; and Specialty Products. The Automotive OEM segment offers plastic and metal components, fasteners, and assemblies for automobiles, light trucks, and other industrial uses. The Food Equipment segment provides warewashing, cooking, refrigeration, and food processing equipment; kitchen exhaust, ventilation, and pollution control systems; and food equipment maintenance and repair services. The Test & Measurement and Electronics segment produce and sells test and measurement; and electroni

Illinois Tool Works Inc. Stock at a Glance

Illinois Tool Works Inc. (ITW) is currently trading at $257.43 with a market capitalization of $74.1B. The trailing P/E ratio stands at 23.92x, with a forward P/E of 21.15x. The 52-week range spans from $238.82 to $303.16; the current price is 15.1% below the yearly high. Year-over-year revenue growth stands at +4.6%. The net profit margin stands at 19.32%.

💰 Dividend

Illinois Tool Works Inc. pays an annual dividend of $6.44 per share, representing a yield of 2.5%. The payout ratio stands at 58.77%.

📊 Analyst Rating

16 analysts rate Illinois Tool Works Inc. (ITW) on consensus: Hold. The average price target is $274.54, implying +6.65% from the current price. Analyst price targets range from $219.00 to $317.00.

Illinois Tool Works Inc.: The Investment Case in Detail

Illinois Tool Works Inc. (ITW) operates in the Industrials — specifically Specialty Industrial Machinery — and is headquartered in United States. Below is a structured read of the investment case built directly from the latest fundamentals, valuation multiples, analyst positioning and smart-money flows. Each section translates raw numbers into the investment logic they imply, so you can decide whether the risk/reward fits your portfolio.

The Bull Case

The combination of a 44.12% gross margin and 25.67% operating margin shows the business converts revenue into profit efficiently — a hallmark of competitive moat. Return on equity of 96.85% places management among the most capital-efficient operators in the public market — every euro of shareholder capital is working hard. Free cash flow is positive and net margins stand at 19.32%, meaning reported earnings translate into real cash that can fund buybacks, dividends or strategic acquisitions.

The Bear Case

Revenue growth has slowed to just 4.6%, which is below nominal GDP — the business is no longer outgrowing the broader economy. The debt-to-equity ratio of 283.22% is elevated, meaning the company relies heavily on creditors — refinancing terms will become more important than operational performance in the next economic downturn.

What to Watch Next

• The forward P/E of 21.15x is meaningfully below the trailing 23.92x — analysts expect earnings to step up; the next earnings release is the test.

Investment Thesis: Strengths & Weaknesses

Technical Snapshot

Price is below both the 50- and 200-day moving averages, with 50d below 200d — a bearish picture (death-cross alignment).

Risk Profile

The data points to market-like volatility, higher leverage relative to equity.

Trading Data

💵 Dividend Info

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