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On Friday, DA Davidson reiterated its Buy rating on ITT Corp. (NYSE:ITT) with a stable price target of $170.00. According to InvestingPro data, ITT is currently trading at a PEG ratio of 0.71, suggesting an attractive valuation relative to its growth prospects. The firm's analysis followed ITT's preliminary financial results for the first quarter of 2025, which showcased revenue that aligned with forecasts, including a slightly stronger organic growth than anticipated. While the adjusted operating income was approximately 1% below DA Davidson's estimates, it was broadly consistent with their projections. The adjusted earnings per share (EPS) are expected to meet the firm's predictions, building on the company's trailing twelve-month EPS of $6.30.
ITT's organic orders saw a year-over-year increase of 2%, resulting in a book-to-bill ratio comfortably above 1.0x. This ratio is a key indicator of future revenue, with values above 1.0 suggesting a healthy backlog of orders. The company also announced its intention to buy back up to $500 million of its own shares, a move supported by ITT's robust balance sheet, which boasted a net leverage of 0.3x at the end of the calendar year 2024. InvestingPro analysis confirms the company's strong financial health with a "GOOD" overall rating, highlighting its moderate debt levels and consistent dividend payments spanning 55 consecutive years.
The share repurchase plan underlines ITT's financial strength and commitment to delivering value to its shareholders. Despite the slight miss in adjusted operating income, the company's overall performance appears solid, with no changes to its guidance provided in the morning's release. ITT's steady financial results and proactive shareholder initiatives seem to affirm DA Davidson's positive stance on the stock. For deeper insights into ITT's valuation and growth prospects, including 8 additional ProTips and comprehensive financial analysis, visit InvestingPro.
In other recent news, ITT Inc. reported stable revenue for the first quarter of 2025, with orders reaching $1.0 billion, marking a 7% increase, although revenue remained flat at over $900 million. The company's operating margin was 16.5%, with an adjusted margin of 17.4%, and earnings per share are projected between $1.29 and $1.35. Free cash flow ranged from $70 million to $80 million, and the Board has authorized a $1 billion share repurchase, with $875 million still available. ITT's fourth-quarter earnings surpassed analyst expectations with an adjusted EPS of $1.50, although revenue was slightly below the forecast at $929 million. The company announced a 10% increase in its quarterly dividend, continuing a trend of annual increases. Analysts from KeyBanc and DA Davidson have differing views, with KeyBanc reducing ITT's price target to $150 while maintaining an Overweight rating, and DA Davidson raising the target to $170 with a Buy rating. Despite cyclical challenges, analysts express confidence in ITT's market positioning and financial health, with expectations for continued performance in its Motion Technologies segment. These developments reflect ITT's ongoing efforts to navigate market conditions and drive shareholder value.
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