Illinois Tool Works (ITW)

NYSEIndustrialsIndustrial - MachinerySnapshot 2026-10-15

$272.28+0.40%

Close 2026-10-16 · 1-day change

Read the published Living FV report summary

Investment OutlookAs of Oct 15, 2026

What could strengthen or challenge Illinois Tool Works’s outlook?

The long-term thesis, the evidence coming in, and the environment around it. Thesis dated Jul 8, 2026.

Higher potential upsideImproving expectations

Next-FY EPS estimate change · 30 days

-0.4%

+10% or more+5%0%−5%−10% or less

12.32 → 12.27 EPS · FY ending Dec 31, 2027 · 11 analysts

Higher risk of downsideWeakening expectations

One observable signal. This measures changing earnings expectations, not the probability of a gain or loss.

How this is measured

Change in the same fiscal period’s mean EPS estimate from Sep 15, 2026 to Oct 15, 2026: (new ÷ prior − 1). Contributor count changed from 11 to 11; this is not the number of analysts revising. Source: FMP consensus snapshots. The ±10% axis is a display range.

Living FV™

Living Fair Value by QuarterlyIQ

A valuation that evolves as the business changes.

A published Living FV snapshot is not available yet. The valuation workflow remains discoverable; a market target cannot supply the missing evidence.

View Living FV report and workflow

What the Thesis Depends On

5 key conditions need to be met for the investment thesis to play out.

Key Factor	Why It Matters	Current Status	Break Condition	Latest Evidence
Return ~$1.5 billion annually via share repurchases	The company returns about $1.5 billion annually to shareholders by buying back stock.	Intact	Annual share repurchases fall below $1 billion	Required source inputs unavailable Cannot calculate Share repurchases from the available matching source inputs. Missing inputs are not treated as zero. Source date unavailableLast status assessment Oct 15, 2026Compare required operating outcomes Compare scope, accounting basis and period before treating this evidence as progress against an annual requirement. Management context Stated as a priority in 5 of last 5 quarters. The company repurchased $375 million of shares each quarter in 2025 and returned over $1.2 billion to shareholders in 2026-Q2 including $750 million in repurchases. Management expects to repurchase approximately $1.5 billion in 2026. The trajectory is consistent with stated plans. Delivery assessment Oct 15, 2026
Increase GAAP EPS to $11.10-$11.50 in 2026	A primary condition in Illinois Tool Works's published investment case. The stated target is EPS $11.10-$11.50.	Intact	EPS falls below $11.10 in FY26	Diluted EPS: $2.84 per share FY2026-Q2; GAAP. Published target: EPS $11.10-$11.50. Target period is not explicitly aligned with this observation. Source published Aug 6, 20262.84 USD/share · source valueSource reportLast status assessment Oct 15, 2026 Measurement source consolidated · GAAP FY2026-Q2 · Period ending Jun 30, 2026 Source: company_financial_results. Reference: 61dbc9fa-d25d-4f55-8f19-074f319b61c5. Source status: eligible. Compare required operating outcomes Compare scope, accounting basis and period before treating this evidence as progress against an annual requirement. Management context Stated as a priority in 4 of last 4 quarters. Diluted EPS increased from $2.66 in 2026-Q1 to $2.84 in 2026-Q2 (+6.8%). Management raised full year 2026 GAAP EPS guidance by $0.15 to $11.35-$11.55 in 2026-Q2, reflecting 9% growth at midpoint. The trajectory is delivering with consistent EPS growth and raised guidance. Delivery assessment Oct 15, 2026
Free cash flow to exceed net income	Free cash flow is expected to exceed net income, supporting investments and buybacks.	Under Pressure	Free cash flow conversion falls below 90% in FY26	Direct metric needs a verified mapping The published measure or accounting basis is not supported by an exact source binding. Source date unavailableLast status assessment Oct 15, 2026Compare required operating outcomes Compare scope, accounting basis and period before treating this evidence as progress against an annual requirement. Management context Stated as a priority in 5 of last 5 quarters. Free cash flow increased from $528M in 2026-Q1 to $631M in 2026-Q2 (+41%), with conversion rates improving from 69% to 77% of net income. Management projects free cash flow to exceed 100% of net income for full year 2026. The trajectory shows progress but conversion remains below 100% so far. Delivery assessment Oct 15, 2026
Maintain operating margin near 27%	Profit margins stay strong near 27%.	Intact	Operating margin falls below 26.5% in FY26	Operating margin: 26.67% FY2026-Q2; GAAP. Published target: >=26.5% operating margin. Target period is not explicitly aligned with this observation. Source published Aug 6, 202626.668217 percent · calculatedSource reportLast status assessment Oct 15, 2026 Measurement source consolidated · GAAP FY2026-Q2 · Period ending Jun 30, 2026 Source: company_financial_results. Reference: 61dbc9fa-d25d-4f55-8f19-074f319b61c5. Source status: eligible. Compare required operating outcomes Compare scope, accounting basis and period before treating this evidence as progress against an annual requirement.
Achieve total revenue growth of 2-4% annually	A primary condition in Illinois Tool Works's published investment case. The stated target is 2-4% YoY.	Intact	YoY revenue growth falls below 2% in FY26	Revenue growth: 6.12% FY2026-Q2; GAAP. Published target: 2-4% YoY. Target period is not explicitly aligned with this observation. Source published Aug 6, 20266.118924 percent · calculatedSource reportLast status assessment Oct 15, 2026 Measurement source consolidated · GAAP FY2026-Q2 · Period ending Jun 30, 2026 Source: company_financial_results. Reference: 61dbc9fa-d25d-4f55-8f19-074f319b61c5. Source status: eligible. Compare required operating outcomes Compare scope, accounting basis and period before treating this evidence as progress against an annual requirement. Management context Stated as a priority in 4 of last 4 quarters. Revenue increased from $4.02B in 2026-Q1 to $4.30B in 2026-Q2 (+6.1%), exceeding prior quarters. Management raised organic growth guidance midpoint by 1.5 points to 3.5% and total revenue growth to 4-5% in 2026-Q2. The trajectory is delivering with accelerating organic growth and raised guidance. Delivery assessment Oct 15, 2026

Stored thesis · Jul 8, 2026. Latest Evidence uses source-matched measurements where available, alongside the last thesis-monitor assessment. Source periods and assessment dates are shown separately. A new measurement does not automatically change the published status or verify an older target.

Incoming Evidence

Compare these dated observations with the operating requirements above

Expectations trend

Same fiscal period

FY2027 · fiscal year ending 2027-12-31 · fmp

FY2027 EPS$12.27

$12.12 → $12.27 · observed estimates

FY2027 revenue$17.43B

$17.20B → $17.43B · observed estimates

Exact estimates & source dates

One fiscal period and provider throughout. At least five contributors are required for each plotted metric; missing coverage stays a gap. Axes show the observed range. Counts measure coverage, not revisions.

FY2027 estimate observations · fmp
Snapshot	EPS	Revenue	EPS / revenue analysts
2026-07-24	$12.12	$17,199,619,315	11 / 11
2026-07-25	$12.12	$17,199,619,315	11 / 11
2026-07-26	$12.20	$17,191,399,270	13 / 14
2026-07-27	$12.13	$17,199,656,098	11 / 11
2026-07-28	$12.20	$17,191,399,270	13 / 14
2026-07-29	$12.20	$17,191,399,270	13 / 14
2026-07-30	$12.20	$17,191,399,270	13 / 14
2026-07-31	$12.31	$17,406,287,330	14 / 14
2026-08-01	$12.29	$17,432,468,106	12 / 11
2026-08-02	$12.29	$17,432,468,106	12 / 11
2026-08-03	$12.31	$17,406,287,330	14 / 14
2026-08-04	$12.31	$17,406,287,330	14 / 14
2026-08-05	$12.31	$17,406,287,330	14 / 14
2026-08-06	$12.29	$17,432,468,106	12 / 11
2026-08-07	$12.29	$17,432,468,106	12 / 11
2026-08-08	$12.29	$17,432,468,106	12 / 11
2026-08-09	$12.35	$17,463,930,190	14 / 14
2026-08-10	$12.29	$17,432,468,106	12 / 11
2026-08-12	$12.29	$17,432,468,106	12 / 11
2026-08-13	$12.29	$17,432,468,106	12 / 11
2026-08-14	$12.29	$17,432,468,106	12 / 11
2026-08-15	$12.29	$17,432,468,106	12 / 11
2026-08-16	$12.29	$17,432,468,106	12 / 11
2026-08-17	$12.29	$17,432,468,106	12 / 11
2026-08-18	$12.29	$17,432,468,106	11 / 11
2026-08-19	$12.29	$17,432,468,106	11 / 11
2026-08-20	$12.32	$17,457,015,932	11 / 11
2026-08-21	$12.32	$17,457,015,932	11 / 11
2026-08-22	$12.32	$17,457,015,932	11 / 11
2026-08-23	$12.32	$17,457,015,932	11 / 11
2026-08-24	$12.32	$17,457,015,932	11 / 11
2026-08-25	$12.32	$17,457,015,932	11 / 11
2026-08-26	$12.32	$17,457,015,932	11 / 11
2026-08-27	$12.32	$17,457,015,932	11 / 11
2026-08-28	$12.32	$17,457,015,932	11 / 11
2026-08-29	$12.32	$17,457,015,932	11 / 11
2026-08-30	$12.32	$17,457,015,932	11 / 11
2026-08-31	$12.32	$17,457,015,932	11 / 11
2026-09-01	$12.32	$17,457,015,932	11 / 11
2026-09-02	$12.32	$17,457,015,932	11 / 11
2026-09-03	$12.32	$17,457,015,932	11 / 11
2026-09-04	$12.32	$17,457,015,932	11 / 11
2026-09-05	$12.32	$17,457,015,932	11 / 11
2026-09-06	$12.32	$17,457,015,932	11 / 11
2026-09-07	$12.32	$17,457,015,932	11 / 11
2026-09-08	$12.32	$17,457,015,932	11 / 11
2026-09-09	$12.32	$17,457,015,932	11 / 11
2026-09-10	$12.32	$17,457,015,932	11 / 11
2026-09-11	$12.32	$17,457,015,932	11 / 11
2026-09-12	$12.32	$17,457,015,932	11 / 11
2026-09-13	$12.32	$17,457,015,932	11 / 11
2026-09-14	$12.32	$17,457,015,932	11 / 11
2026-09-15	$12.32	$17,457,015,932	11 / 11
2026-09-16	$12.32	$17,461,477,471	11 / 11
2026-09-17	$12.32	$17,461,477,471	11 / 11
2026-09-18	$12.32	$17,461,477,471	11 / 11
2026-09-19	$12.32	$17,461,477,471	11 / 11
2026-09-20	$12.32	$17,461,477,471	11 / 11
2026-09-21	$12.32	$17,461,477,471	11 / 11
2026-09-22	$12.32	$17,461,477,471	11 / 11
2026-09-23	$12.32	$17,461,477,471	11 / 11
2026-09-24	$12.32	$17,461,477,471	11 / 11
2026-09-25	$12.33	$17,461,477,471	11 / 11
2026-09-26	$12.33	$17,461,477,471	11 / 11
2026-09-27	$12.33	$17,461,477,471	11 / 11
2026-09-28	$12.33	$17,461,477,471	11 / 11
2026-09-29	$12.33	$17,461,008,686	11 / 11
2026-09-30	$12.32	$17,462,830,021	11 / 11
2026-10-01	$12.32	$17,462,830,021	11 / 11
2026-10-02	$12.32	$17,462,830,021	11 / 11
2026-10-03	$12.32	$17,462,830,021	11 / 11
2026-10-04	$12.32	$17,462,830,021	11 / 11
2026-10-05	$12.32	$17,462,830,021	11 / 11
2026-10-06	$12.32	$17,462,830,021	11 / 11
2026-10-07	$12.31	$17,447,377,786	11 / 11
2026-10-08	$12.31	$17,447,377,786	11 / 11
2026-10-09	$12.31	$17,447,377,786	11 / 11
2026-10-10	$12.31	$17,447,377,786	11 / 11
2026-10-11	$12.27	$17,433,753,098	11 / 11
2026-10-12	$12.27	$17,433,753,098	11 / 11
2026-10-13	$12.27	$17,433,753,098	11 / 11
2026-10-14	$12.27	$17,433,753,098	11 / 11
2026-10-15	$12.27	$17,433,753,098	11 / 11

Revenue and EPS estimates track expectations. They are not delivered results or like-for-like proof of a required annual path.

Compare required revenue and earnings

Analyst view

Monthly observations

Buy / Strong BuyHoldSell / Strong Sell

Exact monthly counts

Monthly rating snapshots · fmp. Missing snapshots are not zero.
Date	Buy*	Hold	Sell*
2026-05-01	2	10	6
2026-06-01	2	10	6
2026-07-01	2	10	4
2026-08-01	2	10	4
2026-09-01	2	11	4
2026-10-01	2	12	3

*Buy includes Strong Buy; Sell includes Strong Sell. Monthly counts describe the analyst mix, not the firms behind each recent action.

Latest: 2 Buy / Strong Buy · 12 Hold · 3 Sell / Strong Sell

0 upgrades1 downgrades1 maintains

Recent actions · Sep 16–Oct 15 · 2 recorded

Price-target changes

30 days

○ Previous · ● Latest · common dollar scale

UBSOct 9 · prior Jul 29

$300.00 → $277.00-7.7%

Truist FinancialOct 5 · prior Jul 2

$301.00 → $297.00-1.3%

$0$165.55$331.10

0 raises · 2 cuts · 0 unchanged · 0 without a comparable prior

How this is measured

Sep 16, 2026–Oct 15, 2026. Each firm's latest positive target is paired only with its immediately prior positive target from the same provider, at most 180 days earlier. Unmatched observations have one dot; conflicting observations are not compared.

Outlook in Brief

The evidence, the remaining questions, and what comes next

What's improving

No recovery evidence is reported in the available driver assessments.

Still unresolved / key risks

Return ~$1.5 billion annually via share repurchasesRequired source inputs unavailable
Increase GAAP EPS to $11.10-$11.50 in 2026Diluted EPS: $2.84 per share
Free cash flow to exceed net incomePublished status: Under Pressure
Maintain operating margin near 27%Operating margin: 26.67%
Achieve total revenue growth of 2-4% annuallyRevenue growth: 6.12%

Next proof point

Oct 23, 2026

Look for updated results and guidance against the published targets, plus direct evidence for unresolved drivers.

Review earnings

Bottom line

5 of 5 published conditions remain under pressure or need verification. The next results need to address those conditions.

The dated weekly assessment and its assumptions are available in Read detailed Outlook.

Historical risk context

Observed price history; separate from operating scenarios

Price sensitivity

0.8%Typical daily move · historical

Downside history

-17.4%Maximum drawdown · trailing year

Read detailed Outlook Company context, assumptions & risks

Illinois Tool Works outlook in detail

The weekly editorial context below is a separate assessment from the dated monitor evidence above. Recovery observations do not automatically change the published thesis. Unverified outside influences are hypotheses, not measured driver evidence.

Updated Oct 10, 2026

What kind of bet this is

This investment represents a stable compounder with a focus on consistent revenue and earnings growth. The current thesis state is intact, supported by recent financial performance that is above many industry peers.

What's priced into Illinois Tool Works

Valuation is considered cheap compared to peers, with a low expectations gap. The market seems to have priced in a level of fragility due to weak execution quality, but this is not seen as a major concern currently.

What the fundamentals likely do

Management is on track to achieve its revenue growth and earnings per share targets for 2026. However, there is a moderate risk due to the potential for sector headwinds that could impact performance.

What Illinois Tool Works hinges on

The thesis hinges on the performance of sector bellwethers and ITW's ability to maintain its guidance. If competitors continue to perform well, it could support ITW's growth; conversely, any negative guidance from peers could pose risks.