10 Undervalued Aerospace Stocks To Buy According to Analysts

4. Textron Inc. (NYSE:TXT)

Average Price Target Upside as of August 15: 20.36%

Forward P/E as of August 15: 14

Textron Inc. (NYSE:TXT) is a diversified global aerospace and defense company. The company operates through various segments including Textron Aviation, Bell, Textron Systems, Industrial, and Textron eAviation. Textron Inc. (NYSE:TXT) is known for its aircraft, helicopters, and military-grade vehicles. It serves both government agencies and commercial customers.

The competitive edge of Textron Inc. (NYSE:TXT) lies in the strong brand recognition of the company and its extensive product mix that allows the company to generate revenue from multiple streams. Utilizing its robust portfolio, especially its Aviation segment, the company has been able to grow its top line by 4% and its bottom line by 10% during the past 3 years.

The second quarter of 2024, proved to be a success for the company. Textron Inc. (NYSE:TXT) was able to grow its revenue to $3.5 billion from $3.4 billion last year. Its Aviation business witnessed the strongest growth as the company delivered 44 commercial turboprops and 42 jets during the quarter. As a result, the revenue for the segment grew 8.3% year-over-year to reach $1.5 billion and generated $195 million in profits. Looking ahead the segment continues to see increased demand as the quarter ended with $7.5 billion in backlog, up $118 million from the previous quarter.

Management of Textron Inc. (NYSE:TXT) has been active in improving its product portfolio through strategic acquisitions. During the quarter, the company acquired Amazilia Aerospace, which has expertise in digital flight controls and flight guidance. Management plans to integrate the expertise and products of Amazilia Aerospace to its new platforms such as Nuuva and Surveyor.

With a 32% subsequent increase in the manufacturing cash flow of the company from $242 million to $320 million and a robust backlog, the company is poised for growth. Textron Inc. (NYSE:TXT) is undervalued as per the analysts. It is trading at 14 times its forward earnings, which is a 27% discount to its sector. Meanwhile, the analysts expect its earnings to grow by 24% during the year to reach $1.99.

19 analysts have a consensus buy rating on the stock, with their 12-month median price target of $103.5 presenting an upside of 20.36% from current levels.