ITT (NYSE: ITT) Continues to Outperform with Strong Q2 2023 Results

KeyBanc's Jeffrey Hammond raised their price target on ITT (NYSE: ITT) by 4.5% from $110 to $115 on August 4, 2023. The analyst maintained their Strong Buy rating on the stock. This update comes after ITT reported strong Q2 2023 results, exceeding expectations and demonstrating resilience in its portfolio.

For the second quarter of 2023, ITT reported earnings per share (EPS) of $1.33, beating the Zacks Consensus Estimate of $1.17 and showing a significant increase of 35.7% compared to Q2 2022's $0.98. The company also reported revenue of $833.9 million, surpassing the Zacks Consensus Estimate of $789 million and showing a year-over-year increase of 13.7% compared to Q2 2022's $733.3 million. ITT's segment operating margin for the quarter stood at 18.7%, and it generated free cash flow of $122.1 million.

Looking ahead to the full year 2023, ITT's management provided guidance of EPS in the range of $4.95 to $5.15. They also projected a segment operating margin of 17.7% to 18.5% and free cash flow between $350 million and $400 million. CEO Luca Savi expressed satisfaction with the strong Q2 performance, highlighting double-digit growth in orders and revenue, as well as an expanding segment margin. Savi also discussed the company's ability to generate cash, which provides flexibility for various strategic initiatives such as mergers and acquisitions, debt reduction, share repurchases, and funding growth investments.

Baird analyst Michael Halloran also provided an update on ITT on August 4, 2023. Halloran raised the price target by 5.9%, from $101 to an updated target of $107, while maintaining a Buy rating on the stock. This positive sentiment from analysts is consistent with the consensus among top-rated analysts, with 100% of them currently rating ITT as a Strong Buy or Buy. None of the analysts surveyed consider it a Hold, and no one recommends selling the stock.

The consensus forecast among analysts is that ITT's next fiscal year will deliver earnings per share (EPS) of $5.18, representing a year-over-year increase of 0.7%. These expectations align with the company's positive trajectory and continued growth.

Since ITT's latest quarterly report on August 3, 2023, the stock price has experienced a slight decline of 0.6%. However, when considering the year-over-year performance, ITT's stock has shown significant growth, with a 31.3% increase. This outpaces the broader market, as the S&P 500 has only risen by 7.9% during the same period.

Jeffrey Hammond, the KeyBanc analyst who raised the price target on ITT, has a strong track record as one of WallStreetZen's top-ranked analysts. Hammond specializes in the Industrials, Consumer Cyclical, and Basic Materials sectors, and has an impressive average return of 5.7% and a win rate of 52.3%.

ITT Incorporated is a manufacturing company that provides engineered components and customized technology solutions to the transportation, industrial, and energy markets in the United States and internationally. The company operates in three segments: Motion Technologies, Industrial Process, and Connect & Control Technologies. ITT serves a diverse range of clients, including original-equipment and Tier 1 manufacturers, as well as aftermarket customers. Founded in 1920 and headquartered in White Plains, NY, ITT has established itself as a key player in its respective industries.

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