JP Morgan maintains bullish stance on Illinois Tool Works

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JP Morgan maintains bullish stance on Illinois Tool Works
Credit: © Reuters.

JP Morgan has maintained its Overweight recommendation for Illinois Tool Works (NYSE: ITW ), setting a one-year price target of $247.04, which suggests a potential upside of 5.78%. The announcement came on Tuesday, reflecting the bank's continued confidence in the company despite projections of a slight decrease in revenue.

Illinois Tool Works, operating under the ITW Business Model, is a global multi-industrial manufacturing leader. The company posted $12.6 billion revenue in 2020, but this year's annual revenue and non-GAAP EPS are projected at 15,905 million and 9.42, respectively, indicating a minor decrease in revenue by 1.06%.

On the dividend front, the company declared a quarterly dividend of $1.40 per share, an increase from the previous $1.31, yielding 2.40%. The dividend payout ratio stands at 0.55, reflecting a balance between income distribution and growth investment under the ITW Business Model. The dividend growth rate is 0.23%.

Institutional ownership saw a slight uptick with six new owners added in the last quarter. However, total shares owned by institutions decreased by 0.86% to 263,518. Despite this slight decrease, the put/call ratio of 0.81 indicates a bullish sentiment among investors.

Major shareholders include Briar Hall Management (8.65%, unchanged), State Farm Mutual Automobile Insurance (6.95%, unchanged), Northern Trust (NASDAQ: NTRS ) (4.16%, portfolio increase of 160.72%), Wells Fargo (NYSE: WFC ) (2.51%, portfolio increase of 193.64%), and Vanguard Total Stock Market Index Fund Investor Shares (2.67%, portfolio decrease of 10.04%). Interestingly, the average portfolio weight dedicated to ITW among all funds decreased by 8.80%.

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