ITW Should I Buy
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Illinois Tool Works Inc (ITW) is not a strong buy for a beginner investor with a long-term focus at this time. While the company has shown solid financial performance and some positive catalysts, the stock appears overbought based on technical indicators, and there is significant insider and hedge fund selling. Additionally, analysts are cautious, with many maintaining Neutral or Underweight ratings. The lack of recent Congress trading data and no strong proprietary trading signals further support a hold recommendation.
The stock is in a bullish trend with MACD above 0 and positively contracting, and moving averages showing a bullish alignment (SMA_5 > SMA_20 > SMA_200). However, the RSI of 85.901 indicates the stock is overbought, suggesting limited immediate upside. Key resistance levels are at R1: 299.511 and R2: 310.144, with support levels at S1: 265.089 and S2: 254.456.
Q4 financials showed revenue growth of 4.09% YoY, net income up 5.33% YoY, and EPS growth of 7.09% YoY.
Gross margin increased to 43.71%, up 1.94% YoY.
Analysts note improving industrial short-cycle demand and sequential revenue growth exceeding historical averages.
Significant insider selling, with a 14,632.38% increase in the last month.
Hedge funds are also selling, with a 173.63% increase in selling over the last quarter.
Analysts are cautious, with several maintaining Neutral or Underweight ratings.
The stock is overbought based on RSI, limiting immediate upside potential.
In Q4 2025, ITW reported revenue of $4.093 billion (up 4.09% YoY), net income of $790 million (up 5.33% YoY), EPS of $2.72 (up 7.09% YoY), and gross margin of 43.71% (up 1.94% YoY). This indicates solid financial performance and growth.
Analysts have mixed views. While some raised price targets (e.g., JPMorgan to $310 with an Overweight rating), others remain cautious with Neutral or Underweight ratings. The consensus reflects limited upside potential, with price targets ranging from $253 to $310.
