Zacks Investment Research downgraded shares of Textron Inc. (TXT) from OUTPERFORM to NEUTRAL on September 20, 2012, with a target price of $29.00.
Textron Inc. second quarter earnings doubled year-over-year and beat the Zacks Consensus Estimate by a dime. The upbeat was driven by strong performance at Bell, continued improvement at Cessna, complemented by good performance in the Industrial business. However a deteriorating Textron Systems was the downside. Going forward, the company's diversified presence across commercial, manufacturing and industrial products, as well as financing operations, insulates it from specific business risk. However valuation continues to be restrained by lower backlog at Cessna, rate of recovery of the business jet market, and defense spending cutbacks. Thus, with limited upside potential, we downgrade our recommendation from Outperform to Neutral on the stock with a target price of $29.00.
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