A Business at a Glance
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ILLINOIS TOOL WORKS INC
ITW
$82.7B
Mkt Cap
$283.02
+2.21%
ILLINOIS TOOL WORKS INC (ITW) has a current P/E ratio of 27.0, compared to its historical median P/E of 22.4. The stock is currently considered Expensive based on its historical valuation range.
ILLINOIS TOOL WORKS INC (ITW) has a 5-year average return on invested capital (ROIC) of 23.0%. This indicates strong capital allocation and a potential competitive advantage.
ILLINOIS TOOL WORKS INC (ITW) has a market capitalization of $81.4B. It is classified as a large-cap stock.
Yes, ILLINOIS TOOL WORKS INC (ITW) pays a dividend with a trailing twelve-month yield of 2.22%. The company also returns capital through share buybacks, with a buyback yield of 1.84%.
Based on historical P/E analysis, ILLINOIS TOOL WORKS INC (ITW) appears expensive. The current P/E of 27.0 is 20% above its historical median of 22.4. The estimated fair value CAGR (P/E method) is 7.7%.
ILLINOIS TOOL WORKS INC (ITW) operates in the General Industrial Machinery & Equipment industry, within the Industrials sector.
Illinois Tool Works is a global manufacturer of diversified industrial products and equipment operating through seven segments: Automotive OEM, Food Equipment, Test & Measurement and Electronics, Welding, Polymers & Fluids, Construction Products, and Specialty Products. The company earns revenue through the design, manufacture, and sale of specialized components, equipment, and consumables across niche markets where it can establish differentiated, high-margin positions; the business model emphasizes customer-back innovation and problem-solving for sophisticated customers with complex needs, supported by a decentralized entrepreneurial culture that enables rapid adaptation to market conditions. ITW's competitive moat rests on its proprietary 80/20 Front-to-Back operating system—a data-driven management process that focuses resources on the highest-value customers and opportunities while eliminating complexity—combined with a portfolio of approximately 21,800 granted and pending patents that protect its innovations. The company serves diverse end markets including automotive original equipment manufacturers and tier suppliers, food service and retail, electronics and semiconductors, general industrial fabrication, construction, energy, and aerospace, with operations spanning 88 divisions across 49 countries and approximately 43,000 employees as of December 2025. Distribution is primarily direct to OEMs and commercial customers, with service and maintenance offerings integrated into several segments, and the company maintains a "produce-where-we-sell" manufacturing strategy to mitigate supply chain and tariff risks while serving regional markets efficiently.
【Organic growth acceleration expected】 Management expects all seven segments to deliver positive organic growth in 2026, with the company guiding for 1% to 3% organic growth reflecting current demand levels adjusted for seasonality. The company is seeing encouraging momentum in capital equipment businesses such as Test & Measurement and Welding, where order rates are meaningfully higher than organic growth rates achieved in the first quarter, though this upside is not yet incorporated into guidance pending confirmation of sustained demand. Enterprise initiatives, including 80/20 Front-to-Back process improvements and strategic sourcing, are projected to contribute approximately 100 basis points of operating margin expansion independent of volume, with the company tracking toward a longer-term 30% operating margin goal. Customer-back innovation is expected to accelerate across all segments and drive above-market growth, while price-cost dynamics are anticipated to be modestly accretive to margins after accounting for tariff impacts and supply chain mitigation actions.
| Metric | Target | Period |
|---|---|---|
| Organic growth | 1% to 3% | FY2026 |
| Operating margin expansion | approximately 100 basis points | FY2026 |
| Operating margin range | 26.5%-27.5% | FY2026 |
| GAAP EPS | $11.10-$11.50 | FY2026 |
| Share repurchases | approximately $1.5 billion | FY2026 |
| Free cash flow conversion | exceed 100% of net income | FY2026 |
Organic growth (FY2026): “Our full year organic growth projection of 1% to 3% remains unchanged, reflecting current demand levels adjusted for seasonality.”
Operating margin expansion (FY2026): “For the full year, we expect operating margin expansion of approximately 100 basis points, powered by our enterprise initiatives.”
Operating margin range (FY2026): “we expect operating margin to improve by approximately 100 basis points to a range of 26.5%-27.5%”
GAAP EPS (FY2026): “we are raising our GAAP EPS guidance by $0.10 to a new range of $11.10-$11.50, representing 8% growth at the $11.30 midpoint”
Share repurchases (FY2026): “we are on track to repurchase approximately $1.5 billion of our shares in 2026”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: 10-K, Q4 FY2025 Earnings Call, Q3 FY2025 Earnings Call, Q1 FY2025 Earnings Call, Q4 FY2024 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 16.2B | 16.0B | 15.9B | 16.1B | 15.9B | 14.5B |
| Net Income | 3.1B | 3.1B | 3.5B | 3.0B | 3.0B | 2.7B |
| EPS | $10.83 | $10.49 | $11.71 | $9.74 | $9.77 | $8.51 |
| Free Cash Flow | 2.7B | 2.7B | 2.8B | 3.1B | 1.9B | 2.3B |
| ROIC | 25.5% | 24.1% | 24.9% | 21.7% | 22.2% | 22.0% |
| Gross Margin | - | 44.1% | 44.3% | 42.2% | 40.8% | 41.3% |
| Debt/Equity | 3.30 | 2.86 | 2.44 | 3.23 | 2.75 | 2.33 |
| Dividends/Share | $6.29 | $6.22 | $5.80 | $5.42 | $5.06 | $4.72 |
| Operating Income | 4.3B | 4.2B | 4.3B | 4.0B | 3.8B | 3.5B |
| Operating Margin | 26.4% | 26.3% | 26.8% | 25.1% | 23.8% | 24.1% |
| ROE | 97.0% | 93.7% | 110.2% | 96.9% | 90.4% | 79.1% |
| Shares Outstanding | 288M | 292M | 298M | 304M | 311M | 317M |
| Metric | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 14.5B | 13.4B | 13.6B | 14.3B | 14.8B | 14.1B | 12.6B | 14.5B | 15.9B | 16.1B | 15.9B | 16.0B | 16.2B |
| Gross Margin | 40.1% | 41.2% | 41.8% | 42.0% | 41.7% | 42.0% | 41.3% | 41.3% | 40.8% | 42.2% | 44.3% | 44.1% | N/A |
| R&D | 227M | 218M | 223M | 225M | 233M | 221M | 214M | 239M | 269M | 284M | 292M | 302M | 302M |
| SG&A | 2.9B | 2.6B | 2.6B | 2.5B | 2.6B | 2.5B | 2.3B | 2.5B | 2.7B | 2.8B | 2.8B | 2.9B | 2.9B |
| EBIT | 2.9B | 2.9B | 3.1B | 3.5B | 3.6B | 3.4B | 2.9B | 3.5B | 3.8B | 4.0B | 4.3B | 4.2B | 4.3B |
| Op. Margin | 19.9% | 21.4% | 22.5% | 24.3% | 24.3% | 24.1% | 22.9% | 24.1% | 23.8% | 25.1% | 26.8% | 26.3% | 26.4% |
| Net Income | 2.9B | 1.9B | 2.0B | 1.7B | 2.6B | 2.5B | 2.1B | 2.7B | 3.0B | 3.0B | 3.5B | 3.1B | 3.1B |
| Net Margin | 20.3% | 14.2% | 15.0% | 11.8% | 17.4% | 17.9% | 16.8% | 18.6% | 19.0% | 18.4% | 21.9% | 19.1% | 19.3% |
| Non-Recurring | 0 | -1.0M | -1.0M | 1.0M | 7.0M | 9.0M | -2.0M | 0 | 1.0M | 1.0M | 0 | -3.0M | -3.0M |
| Returns on Capital | |||||||||||||
| ROIC | 16.6% | 18.8% | 19.7% | 21.5% | 23.8% | 22.5% | 19.1% | 22.0% | 22.2% | 21.7% | 24.9% | 24.1% | 25.5% |
| ROE | 35.6% | 31.5% | 42.9% | 38.1% | 65.3% | 80.2% | 67.9% | 79.1% | 90.4% | 96.9% | 110.2% | 93.7% | 97.0% |
| ROA | 15.9% | 11.4% | 13.2% | 10.6% | 16.2% | 16.8% | 13.7% | 17.0% | 19.3% | 19.1% | 22.8% | 19.6% | 19.3% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | 1.6B | 2.3B | 2.3B | 2.4B | 2.8B | 3.0B | 2.8B | 2.6B | 2.3B | 3.5B | 3.3B | 3.1B | 3.2B |
| Free Cash Flow | 1.3B | 2.0B | 2.0B | 2.1B | 2.4B | 2.7B | 2.6B | 2.3B | 1.9B | 3.1B | 2.8B | 2.7B | 2.7B |
| Owner Earnings | 1.1B | 1.8B | 2.0B | 2.1B | 2.5B | 2.7B | 2.5B | 2.2B | 2.0B | 3.2B | 2.9B | 2.7B | -1.3B |
| CapEx | 361M | 284M | 273M | 297M | 364M | 326M | 236M | 296M | 412M | 455M | 437M | 419M | 418M |
| Maint. CapEx | 504M | 475M | 246M | 256M | 272M | 267M | 273M | 277M | 276M | 282M | 301M | 317M | 4.4B |
| Growth CapEx | 0 | 0 | 27M | 41M | 92M | 59M | 0 | 19M | 136M | 173M | 136M | 102M | 0 |
| D&A | 504M | 475M | 246M | 256M | 272M | 267M | 273M | 277M | 276M | 282M | 301M | 317M | 4.4B |
| CapEx/OCF | 22.3% | 12.4% | 11.9% | 12.4% | 12.9% | 10.9% | 8.4% | 11.6% | 17.5% | 12.9% | 13.3% | 13.4% | 13.2% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 711M | 742M | 821M | 941M | 1.1B | 1.3B | 1.4B | 1.5B | 1.5B | 1.6B | 1.7B | 1.8B | 1.8B |
| Dividend Yield | 2.7% | 2.8% | 2.7% | 2.4% | 2.8% | 3.1% | 2.7% | 2.3% | 2.6% | 2.4% | 2.3% | 2.5% | 2.2% |
| Share Buybacks | 4.3B | 2.0B | 2.0B | 1.0B | 2.0B | 1.5B | 706M | 1.0B | 1.8B | 1.5B | 1.5B | 1.5B | 1.5B |
| Buyback Yield | 14.5% | 7.4% | 5.7% | 2.1% | 5.7% | 3.0% | 1.2% | 1.4% | 2.8% | 2.0% | 2.0% | 2.1% | 1.8% |
| Stock-Based Comp | 39M | 41M | 39M | 36M | 40M | 41M | 42M | 53M | 63M | 69M | 61M | 69M | 71M |
| Debt Repayment | 1.8B | 2.0M | 1.0M | 652M | 1.0M | 1.4B | 4.0M | 351M | 1.1B | 679M | 1.9B | 0 | 0 |
| Balance Sheet | |||||||||||||
| Net Debt | 3.4B | 4.3B | 5.4B | 5.2B | 5.9B | 6.0B | 6.1B | 6.9B | 7.8B | 8.7B | 7.1B | 8.4B | 9.8B |
| Cash & Equiv. | 4.0B | 3.1B | 2.5B | 3.1B | 1.5B | 2.0B | 2.6B | 1.5B | 708M | 1.1B | 948M | 851M | 827M |
| Long-Term Debt | 5.9B | 6.9B | 7.2B | 7.5B | 6.0B | 7.8B | 7.8B | 6.9B | 6.2B | 6.3B | 6.3B | 6.7B | 6.6B |
| Debt/Equity | 1.08 | 1.41 | 1.84 | 1.81 | 2.26 | 2.62 | 2.72 | 2.33 | 2.75 | 3.23 | 2.44 | 2.86 | 3.30 |
| Interest Coverage | 11.6 | 12.7 | 12.9 | 13.4 | 13.9 | 15.4 | 14.0 | 17.2 | 18.7 | 15.2 | 15.1 | 14.4 | 14.4 |
| Equity | 6.8B | 5.2B | 4.3B | 4.6B | 3.3B | 3.0B | 3.2B | 3.6B | 3.1B | 3.0B | 3.3B | 3.2B | 3.2B |
| Total Assets | 17.5B | 15.7B | 15.2B | 16.8B | 14.9B | 15.1B | 15.6B | 16.1B | 15.4B | 15.5B | 15.1B | 16.1B | 16.3B |
| Total Liabilities | 10.6B | 10.5B | 10.9B | 12.2B | 11.6B | 12.0B | 12.4B | 12.4B | 12.3B | 12.5B | 11.7B | 12.9B | -100M |
| Intangibles | 1.8B | 1.6B | 1.5B | 1.3B | 1.1B | 851M | 781M | 972M | 768M | 657M | 592M | 591M | 574M |
| Retained Earnings | 17.2B | 18.3B | 19.5B | 20.2B | 21.2B | 22.4B | 23.1B | 24.3B | 25.8B | 27.1B | 28.9B | 30.1B | 30.5B |
| Working Capital | 4.3B | 4.4B | 3.4B | 4.2B | 2.2B | 4.1B | 3.9B | 2.9B | 1.8B | 1.6B | 1.5B | 1.1B | 1.0B |
| Current Assets | 7.9B | 6.7B | 6.1B | 7.3B | 5.8B | 6.3B | 6.5B | 6.4B | 6.3B | 6.2B | 5.9B | 6.2B | 6.3B |
| Current Liabilities | 3.5B | 2.4B | 2.8B | 3.1B | 3.5B | 2.2B | 2.6B | 3.5B | 4.5B | 4.7B | 4.3B | 5.1B | 5.3B |
| Per Share Data | |||||||||||||
| EPS | 7.28 | 5.13 | 5.70 | 4.86 | 7.60 | 7.74 | 6.63 | 8.51 | 9.77 | 9.74 | 11.71 | 10.49 | 10.83 |
| Owner EPS | 2.65 | 4.82 | 5.65 | 6.08 | 7.41 | 8.25 | 7.83 | 7.03 | 6.47 | 10.50 | 9.80 | 9.37 | -4.46 |
| Book Value | 16.86 | 14.12 | 11.93 | 13.22 | 9.66 | 9.30 | 10.00 | 11.45 | 9.95 | 9.92 | 11.14 | 11.04 | 11.23 |
| Cash Flow/Share | 3.99 | 6.21 | 6.45 | 6.92 | 8.34 | 9.20 | 8.82 | 8.08 | 7.56 | 11.66 | 11.02 | 10.70 | 26.08 |
| Dividends/Share | 1.81 | 2.07 | 2.40 | 2.86 | 3.56 | 4.14 | 4.42 | 4.72 | 5.06 | 5.42 | 5.80 | 6.22 | 6.29 |
| Shares Out. | 404.7M | 370.2M | 357.0M | 347.1M | 337.2M | 325.7M | 318.1M | 316.6M | 310.5M | 303.6M | 297.9M | 292.3M | 287.7M |
| Valuation | |||||||||||||
| P/E Ratio | 10.2 | 14.3 | 17.3 | 28.1 | 13.8 | 20.1 | 26.9 | 26.0 | 20.8 | 25.5 | 21.1 | 23.8 | 26.1 |
| P/FCF | 23.9 | 13.5 | 17.3 | 22.5 | 14.4 | 19.0 | 22.0 | 30.9 | 32.6 | 24.4 | 25.9 | 26.9 | 29.7 |
| EV/EBIT | 10.7 | 10.1 | 12.6 | 14.5 | 11.5 | 16.0 | 20.8 | 21.7 | 18.7 | 20.6 | 19.0 | 19.5 | 21.3 |
| Price/Book | 4.4 | 5.2 | 8.3 | 10.3 | 10.8 | 16.7 | 17.8 | 19.3 | 20.4 | 25.0 | 22.2 | 22.6 | 25.2 |
| Price/Sales | 1.8 | 2.0 | 2.3 | 2.8 | 2.8 | 3.0 | 4.0 | 4.4 | 3.7 | 4.2 | 4.6 | 4.5 | 5.0 |
| FCF Yield | 4.2% | 7.4% | 5.8% | 4.4% | 6.9% | 5.3% | 4.5% | 3.2% | 3.1% | 4.1% | 3.9% | 3.7% | 3.4% |
| Market Cap | 30.0B | 27.1B | 35.2B | 47.4B | 35.3B | 50.6B | 56.7B | 69.9B | 63.1B | 75.3B | 73.6B | 72.9B | 81.4B |
| Avg. Price | 65.27 | 71.58 | 85.96 | 115.23 | 121.15 | 129.47 | 158.59 | 199.10 | 190.59 | 221.99 | 243.23 | 246.66 | 283.02 |
| Year-End Price | 74.17 | 73.24 | 98.51 | 136.54 | 104.80 | 155.37 | 178.11 | 220.95 | 203.08 | 248.14 | 247.23 | 249.26 | 283.02 |
ILLINOIS TOOL WORKS INC passes 6 of 9 quality checks, suggesting mixed fundamentals.
ILLINOIS TOOL WORKS INC trades at 27.0x trailing earnings, compared to its 15-year median P/E of 22.4x, suggesting it is currently Expensive relative to its historical range. On a free-cash-flow basis, the stock trades at 30.6x vs a median of 23.5x. The company's 5-year average ROIC is 23.0% with a gross margin of 42.5%. Total shareholder yield (dividends + buybacks) is 4.1%. At current prices, the estimated annualized return to fair value is +4.0%.
ILLINOIS TOOL WORKS INC (ITW) reported annual revenue of $16.0 billion in its most recent fiscal year, based on SEC EDGAR filings.
ILLINOIS TOOL WORKS INC (ITW) has a net profit margin of 19.1%. This is a healthy margin.
ILLINOIS TOOL WORKS INC (ITW) generated $2.7 billion in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
ILLINOIS TOOL WORKS INC (ITW) has a debt-to-equity ratio of 2.86. This indicates higher leverage, which may increase financial risk.
ILLINOIS TOOL WORKS INC (ITW) reported earnings per share (EPS) of $10.49 in its most recent fiscal year.
ILLINOIS TOOL WORKS INC (ITW) has a return on equity (ROE) of 93.7%. This indicates the company generates strong returns for shareholders.
ILLINOIS TOOL WORKS INC (ITW) has a 5-year average gross margin of 42.5%. This indicates decent pricing power.
The Ledger Terminal provides 19 years of financial data for ILLINOIS TOOL WORKS INC (ITW), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
ILLINOIS TOOL WORKS INC (ITW) has a book value per share of $11.04, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects all seven segments to deliver positive organic growth in 2026, with the company guiding for 1% to 3% organic growth reflecting current demand levels adjusted for seasonality. The company is seeing encouraging momentum in capital equipment businesses such as Test & Measurement and Welding, where order rates are meaningfully higher than organic growth rates achieved in the first quarter, though this upside is not yet incorporated into guidance pending confirmation of sustained demand. Enterprise initiatives, including 80/20 Front-to-Back process improvements and strategic sourcing, are projected to contribute approximately 100 basis points of operating margin expansion independent of volume, with the company tracking toward a longer-term 30% operating margin goal. Customer-back innovation is expected to accelerate across all segments and drive above-market growth, while price-cost dynamics are anticipated to be modestly accretive to margins after accounting for tariff impacts and supply chain mitigation actions.
Based on recent SEC filings and earnings calls, ILLINOIS TOOL WORKS INC (ITW) has provided the following forward guidance: Organic growth: 1% to 3% (FY2026); Operating margin expansion: approximately 100 basis points (FY2026); Operating margin range: 26.5%-27.5% (FY2026); GAAP EPS: $11.10-$11.50 (FY2026); Share repurchases: approximately $1.5 billion (FY2026), plus 1 additional metric.
Free cash flow conversion (FY2026): “we expect free cash flow conversion to exceed 100% of net income”