NYSE$ITW

Illinois Tool Works Inc · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

ITW's Q3 2021 results were reported, featuring revenue growth and strong performance in multiple segments, but were impacted by supply chain challenges in the Automotive OEM segment.

ITW reported an 8% increase in total revenue to $3.6 billion, with 6% organic growth. EPS increased by 10% to $2.02. The company saw strong growth momentum in six of its seven segments, while the Automotive OEM segment was impacted by supply chain challenges.

  • Total revenue increased by 8% to $3.6 billion, with organic revenue growth of 6%.
  • Operating income grew by 7% to $845 million.
  • GAAP EPS increased 10% to $2.02.
  • Welding, Food Equipment, and Test & Measurement and Electronics segments led organic growth.

Headline financials

Total Revenue

$3.56B

Previous: $3.31B+7.5%
EPS (adj)

$1.96

Previous: $1.83+7.1%
Organic revenue growth

6.0%

Previous: -4.6%+230.4%
Capital Expenditures

-$217M

Previous: -$168M-29.2%
Free Cash Flow

$422M

Previous: $414M+1.9%
Net Income

$639M

Previous: $582M+9.8%
Operating Income

$845M

Previous: $789M+7.1%
Gross Profit

$1.46B

Previous: $1.4B+4.5%
Cash & Equivalents

$1.99B

Previous: $2.17B-8.4%
Total Assets

$15.5B

Previous: $14.9B+3.9%
Stock-Based Comp

$14M

Previous: $14M+0.0%

Revenue & EPS history

ITW · Revenue · Quarterly

$3.56B

Q3 2021+7.5%vs Q3 2020
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

ITW · $3.56B total across 7 segments · Q3 2021

  • Automotive OEM
    $647M-9.4%
  • Test & Measurement
    $552M+12.9%
  • Food Equipment
    $544M+21.2%
  • Construction Products
    $478M+4.8%
  • Specialty Products
    $459M+9.3%
  • Polymers & Fluids
    $456M+4.1%
  • Welding
    $425M+22.8%

Forward guidance

ITW expects total revenue growth of 13 to 14 percent and organic growth in the range of 11 to 12 percent. GAAP EPS guidance is updated to a range of $8.30 to $8.50.

Tailwinds

  • Total revenue growth of 13 to 14 percent expected.
  • Organic growth in the range of 11 to 12 percent expected.
  • Raw material cost increases are expected to be offset with price.
  • Volume leverage is expected to contribute more than 200 basis points.
  • Enterprise initiatives are expected to contribute more than 100 basis points.

Headwinds

  • GAAP EPS guidance is updated to a range of $8.30 to $8.50, due to actual and anticipated lower auto production levels in Q3 and Q4.
  • Full year margin dilution impact from price/cost is expected to be approximately 150 basis points.
  • Guidance excludes any impact from the acquisition of the MTS Test & Simulation business.
  • The Automotive OEM segment continued to be impacted by auto production reductions.
  • Global supply chain challenges.

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 Q3 2021

Historical avgQ3 2021

-0.0%

Avg return

Earnings day

+0.1%

Avg return

5 days after

+1.2%

Avg return

30 days after

49%

36 / 73 earnings

Positive

+6.5%

Q1 2022

Best reaction

-7.7%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.7%-4.2%-7.0%
Q4 2025+4.5%+11.1%+6.9%
Q3 2025-4.5%-6.0%-3.8%
Q2 2025+0.9%+0.9%+4.3%
Q1 2025-0.8%-0.4%+1.4%
Q4 2024-0.2%+1.2%+7.8%
Q3 2024+2.0%+3.1%+8.4%
Q2 2024-0.3%-1.7%+1.0%
Q1 2024-2.8%-2.1%-4.6%
Q4 2023-1.9%-2.0%-0.3%
Q3 2023+1.6%+0.4%+8.2%
Q2 2023-5.1%-6.3%-6.1%
Q1 2023-5.5%-6.3%-9.7%
Q4 2022+3.0%-0.1%-0.3%
Q3 2022+3.4%+6.6%+13.9%
Q2 2022+0.6%+1.6%-4.9%
Q1 2022+6.5%+4.6%+4.6%
Q4 2021-3.0%-4.4%-10.1%
Q3 2021+2.6%+3.6%+5.6%
Q2 2021-1.3%-0.4%+1.0%
Q1 2021+1.2%+2.1%+0.4%
Q4 2020+3.6%+4.0%+6.6%
Q3 2020-0.9%-4.5%+1.1%
Q2 2020+0.1%+1.5%+8.1%
Q1 2020+0.3%+1.7%+12.9%
Q4 2019-0.8%+4.4%-5.7%
Q3 2019+6.1%+6.3%+8.4%
Q2 2019-1.8%-2.8%-7.7%
Q1 2019-2.1%-0.8%-7.1%
Q4 2018+0.8%+0.2%+5.2%
Q3 2018-3.1%-0.6%+6.0%
Q2 2018-5.9%-4.5%-7.3%
Q1 2018-6.0%-5.0%-2.8%
Q4 2017+1.0%+2.2%-5.3%
Q3 2017+2.2%+2.6%+3.0%
Q2 2017-3.8%-4.4%-7.3%
Q1 2017+3.3%+2.4%+3.4%
Q4 2016+0.9%+1.4%+3.6%
Q3 2016-2.3%-3.4%+7.1%
Q2 2016+2.6%+3.3%+7.7%
Q1 2016-1.0%
Q4 2015+5.3%
Q3 2015+5.2%
Q2 2015-3.0%
Q1 2015-2.7%
Q4 2014-1.7%
Q3 2014+3.2%
Q2 2014-0.8%
Q1 2014+0.9%
Q4 2013+0.0%
Q3 2013+0.8%
Q2 2013-3.1%
Q1 2013+5.6%
Q4 2012-2.9%
Q3 2012-0.7%
Q2 2012-1.6%
Q1 2012+4.2%
Q4 2011+0.2%
Q3 2011-1.1%
Q2 2011-7.7%
Q1 2011+1.1%
Q4 2010-0.2%
Q4 2007-0.2%
Q3 2010+0.7%
Q2 2010+0.1%
Q1 2009+4.1%
Q1 2010+0.5%
Q4 2009+1.9%
Q3 2008-1.3%
Q3 2009-1.3%
Q2 2009-0.9%
Q4 2008-0.9%
Q2 2008-0.9%

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