Textron Shares Popped: What You Need to Know (TXT)

Textron Shares Popped: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of aircraft and defense conglomerate Textron (NYSE: TXT ) soared today, gaining as much as 12% in intraday trading on heavy volume.

So what: Before the market opened, Textron delivered its second-quarter numbers, and investors liked what they saw. Total revenue came in at $2.7 billion, up less than 1% from last year and short of Wall Street's $2.8 billion projection. However, earnings per share clocked in at $0.29, which solidly beat the $0.24 that analysts were looking for.

Now what: Obviously, investors are excited about Textron's report, but I have to say that I'm not totally clear why. Don't get me wrong -- it's a good enough report that delivered a nice-sized bottom-line beat. Cessna's return to an operating profit is also exciting news, since that segment has been struggling badly since the recession hit. Management also reaffirmed its full-year outlook for profit per share of $1.00 to $1.15. However, I'm not quite sure all of that adds up to justify quite the reaction that the stock is having today.

All of that said, I think Textron is a fine company. Investors with their eye on this one may just want to keep watching and wait for today's excitement to wear off a bit.

Want to keep up to date on Textron? Add it to your watchlist.

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The Motley Fool owns shares of Textron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

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