Manufacturing is recovering from The Great Recession which means there is a bullish outlook for Illinois Tool Works (NYSE: ITW). While Illinois Tool Works has recovered strongly from The Great Recession, it is still appealing (chart below). Here are 3 reasons why long term investors should be interested in Illinois Tool Works.
There is a favorable earnings outlook.
Over the past five years, earnings-per-share for Illinois Tools Works was 2.30 percent. Over the next five years, it is projected to be 7.60 percent. That is a very bullish trend for earnings, which are critical.
It is a very profitable company.
Making profits is still what it is all about. The profit margin for Illinois Tool Works is 19.40 percent. That is about twice the average for a member of the Standard & Poor’s 500 Index (NYSE: SPY). It is comparable to the profit margin for Apple (NASDAQ: AAPL).
The dividend yield is also much more appealing than the average stock on the S&P 500.
For a company on the S&P 500%, the dividend yield is under 2 percent. It is more than 10 percent higher at 2.21 percent for Illinois Tool Works. In addition, Illinois Tool Works is a “Dividend Aristocrat.” To be a Dividend Aristocrat, a company must have increased the amount of the dividend annually for at least the past 25 years.
Wall Street is bullish about Illinois Tool Works.
Up for the last week, month, quarter, six months, and year of market action, the analyst community still expects the share price of Illinois Tool Works to rise. The stock price for Illinois Tool Works is now $87.97, up nearly 24 percent for the year of market action. Over the next year of trading, the Wall Street analyst community has set $92.93 as the mean target price.
Coupled with the dividend that has a history of increasing, that makes for a robust total return for long term investors with Illinois Tool Works!