Illinois Tool Works Inc.
Illinois Tool Works (ITW) is a diversified industrial manufacturer supplying engineered fasteners, components, consumables and equipment across automotive, construction, foodservice, electronics and other sectors. Its decentralised operating model gives autonomy to specialised business units, aiming to drive margin expansion and operational efficiency, while corporate steers capital allocation and strategy. ITW is known for steady free cash flow, a long-running dividend and disciplined share buybacks, often supplemented by targeted acquisitions. Strengths include a broad product mix, pricing power in niche markets and proven cash generation. Key risks are economic cyclicality, commodity and freight cost volatility, currency movements and integration risks from acquisitions. Valuation and short-term performance can be sensitive to macro conditions. This summary is general educational information, not personalised advice — investors should consider their own goals and risk tolerance before acting.
Why It's Moving
ITW Boosts Dividend 7% in 62nd Straight Yearly Hike, Signaling Board Confidence Amid Steady Operations.
Illinois Tool Works declared a quarterly dividend of $1.61 per share for Q4 2025, annualizing to $6.44 and marking the company's 62nd consecutive annual increase. This move underscores robust free cash flow generation and a commitment to shareholder returns, even as analysts adjust targets lower following Q3's solid but modest results.
- Dividend raised by $0.11 per share, reflecting strong Q3 free cash flow of $904M (up 15%) and 110% conversion to net income[1][6].
- Q3 revenue hit $4.1B with record 27.4% operating margin, driven by enterprise initiatives adding 140 bps to profitability[1].
- Full-year EPS guidance narrowed to $10.40–$10.50 with $1.5B share repurchases planned, highlighting disciplined capital allocation[1].
ITW Boosts Dividend 7% in 62nd Straight Yearly Hike, Signaling Board Confidence Amid Steady Operations.
Illinois Tool Works declared a quarterly dividend of $1.61 per share for Q4 2025, annualizing to $6.44 and marking the company's 62nd consecutive annual increase. This move underscores robust free cash flow generation and a commitment to shareholder returns, even as analysts adjust targets lower following Q3's solid but modest results.
- Dividend raised by $0.11 per share, reflecting strong Q3 free cash flow of $904M (up 15%) and 110% conversion to net income[1][6].
- Q3 revenue hit $4.1B with record 27.4% operating margin, driven by enterprise initiatives adding 140 bps to profitability[1].
- Full-year EPS guidance narrowed to $10.40–$10.50 with $1.5B share repurchases planned, highlighting disciplined capital allocation[1].
Stock Performance Snapshot
Analyst Rating
Analysts suggest holding Illinois Tool Works stock, expecting a slight increase in value.
Financial Health
Illinois Tool Works shows strong profits and cash flow, indicating solid financial stability and performance.
Dividend
Illinois Tool Works Inc.'s dividend yield of 3.07% offers reasonable income for investors seeking dividends. If you invested $1000 you would be paid $30.70 a year in dividends (based on the last 12 months).
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Explore BasketWhy You’ll Want to Watch This Stock
Cash Flow Strength
ITW typically generates solid free cash flow that has supported dividends and buybacks; remember cash generation can vary with the cycle.
Operational Model Edge
A decentralised structure encourages focused product teams and margin discipline, though execution and integration risk remain.
Diverse End Markets
Exposure to automotive, construction and foodservice provides diversification, but global demand swings can still affect results.
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