NYSE$ITT

ITT Inc · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

ITT demonstrated resilience and benefited from actions taken to address the challenges of the global pandemic.

ITT Inc. reported a fourth quarter year-over-year sales decline of 2%, down 4% on an organic basis. Segment operating margin for the fourth quarter of 16.9% expanded 200 basis points and adjusted segment operating margin expanded 150 basis points. Earnings per share was a loss of $0.16, but adjusted earnings per share increased 2% to $1.01 versus prior year despite the sales decline.

  • Delivered 200 basis points improvement in segment operating margin, 150 basis points improvement in adjusted segment operating margin
  • Motion Technologies grew 10% on an organic basis, with over 400 basis points of adjusted margin expansion fueled by growth in our Friction business.
  • Adjusted segment margins in Industrial Process expanded 90 basis points driven by productivity and cost controls.
  • Announced a 30% increase in quarterly dividend to $0.22 per share

Headline financials

Total Revenue

$709M

Previous: $719M-1.5%
EPS (adj)

$1.01

Previous: $0.99+2.0%
Total Organic Growth

-3.9%

Previous: 4.0%-197.5%
Motion Technologies Organic Growth

10.3%

Previous: 7.0%+47.1%
Industrial Process Organic Growth

-10.4%

Previous: 4.0%-360.0%
Connect & Control Technologies Organic Growth

-20.9%

Previous: -2.0%-945.0%
Free Cash Flow

$102M

No prior period
Net Income

-$13.5M

Previous: $69.1M-119.5%
Operating Income

$159M

Previous: $82.3M+93.4%
Gross Profit

$219M

Previous: $228M-4.1%
Cash & Equivalents

$860M

Previous: $612M+40.5%
Total Assets

$4.28B

Previous: $4.11B+4.1%
Stock-Based Comp

$3.7M

Previous: $3.4M+8.8%

Revenue & EPS history

ITT · Revenue · Quarterly

$709M

Q4 2020-1.5%vs Q4 2019
Beat estimate in 16 of 16 quarters(100%)
ActualEstimate

Revenue by segment

ITT · $709M total across 3 segments · Q4 2020

  • Motion Technologies
    $352M+15.7%
  • Industrial Process
    $228M-10.5%
  • Connect & Control Technologies
    $129M-19.8%

Forward guidance

The company’s 2021 guidance assumes limited further disruption from the COVID-19 global pandemic, which significantly impacted 2020 performance, and continued improvement in global economic activity, particularly in the second half of 2021.

Tailwinds

  • We expect revenue growth of 5% to 7%, or up 2% to 4% on an organic basis
  • Segment operating margin of 15.5% to 16.0%, and adjusted segment operating margin range of 16.5% to 17.0%, up 130 to 180 bps
  • Earnings per share of $3.12 to $3.48
  • Adjusted earnings per share of $3.45 to $3.75 per share, up 8% to 17%
  • Free cash flow of $270 million to $300 million, representing free cash flow margin of 10% to 12% for the full year.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+1.9%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.1%

Avg return

30 days after

65%

47 / 72 earnings

Positive

+17.4%

Q3 2019

Best reaction

-9.9%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.8%-2.8%-10.0%
Q4 2025+9.1%+8.3%+0.2%
Q3 2025+11.2%+5.5%+4.7%
Q1 2025+0.7%+3.6%+9.9%
Q4 2024-2.1%-2.6%-7.2%
Q3 2024+0.2%-2.8%+7.7%
Q2 2024-8.3%-8.8%-1.6%
Q1 2024-0.8%+4.1%+2.8%
Q4 2023-2.7%-4.9%+1.1%
Q3 2023+7.7%+6.8%+17.3%
Q2 2023+3.0%+2.6%+5.2%
Q1 2023+0.9%-1.3%-0.6%
Q4 2022-0.4%+2.5%-5.3%
Q3 2022+1.5%+3.2%+13.8%
Q2 2022+4.2%+3.8%-4.3%
Q1 2022+6.7%+0.3%+5.0%
Q4 2021-3.1%-7.5%-18.9%
Q3 2021+3.2%+6.5%-1.7%
Q2 2021+0.7%+1.3%-3.3%
Q1 2021+1.6%-4.6%-3.9%
Q4 2020+4.4%+8.6%+14.8%
Q3 2020-0.7%+0.0%+19.5%
Q2 2020+0.7%+1.2%+8.5%
Q1 2020-9.9%-9.0%+9.4%
Q4 2019-3.5%-10.2%-43.9%
Q3 2019+17.4%+15.5%+17.4%
Q2 2019-6.2%-5.9%-6.2%
Q1 2019+3.8%+3.0%-3.2%
Q4 2018+4.0%+3.4%-0.5%
Q3 2018+5.5%+7.4%+5.1%
Q2 2018+10.1%+8.8%+4.8%
Q1 2018+5.9%+6.7%+7.6%
Q4 2017-0.3%+0.9%-0.8%
Q3 2017+9.7%+10.2%+14.4%
Q2 2017+2.2%+1.1%+0.1%
Q1 2017-1.3%-4.5%-9.2%
Q4 2016+2.6%-0.6%-2.3%
Q3 2016-0.5%+4.4%+20.7%
Q2 2016+5.2%+7.2%+16.1%
Q1 2016-8.5%
Q4 2015+6.2%
Q3 2015+2.2%
Q2 2015-2.1%
Q1 2015+2.9%
Q4 2014+4.5%
Q3 2014+2.7%
Q2 2014-1.9%
Q1 2014+2.0%
Q4 2013+3.3%
Q3 2013+9.2%
Q2 2013+10.1%
Q1 2013+3.3%
Q4 2012+4.3%
Q3 2012+3.4%
Q2 2012+12.0%
Q1 2012+0.0%
Q4 2011+6.5%
Q3 2011+2.9%
Q2 2011-4.7%
Q1 2011+1.4%
Q4 2010+1.1%
Q3 2010-0.3%
Q2 2010-1.5%
Q1 2010-3.3%
Q1 2009+1.9%
Q4 2007+1.9%
Q4 2009+1.9%
Q3 2009-0.1%
Q3 2008-0.1%
Q4 2008-1.7%
Q2 2009-1.7%
Q2 2008-1.7%

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