What happened

Shares of Textron (NYSE:TXT) traded down more than 10% at midday Monday before recovering somewhat to close down 7%, on growing investor gloom about the economy. Textron has been an underperformer for years and was seen coming into 2020 as a company in desperate need of a spark. With the economy souring, that catalyst is going to be significantly harder to find.

So what

Textron has been a hard stock to get behind in recent years, with the company mired in a slump due to a series of issues spread across the industrial conglomerate's portfolio that have led to earnings misses. There was reason to hope that strong consumer demand for snowmobiles or golf carts or a surge in business jet sales would help get the company moving in the right direction in 2020, but current events suggest a surge is unlikely.

An investor angrily looks at a stock chart headed down.

Image source: Getty Images.

A U.S. recession, coupled with low oil prices, could stifle demand for new business jets. And Textron's snowmobiles and golf carts are going to be tough to move if the U.S. consumer is on the sidelines. Add in the risk of slumping aerospace sales due to a drop in travel demand, and it is hard to find a reason to get excited about Textron right now.

Shares are now down 44% over the past month.

Now what

Textron, like a large portion of the industrial sector, appears headed toward a miserable first quarter, and the weakness seems likely to continue into the second half of 2020 at least.

Textron currently trades at 7 times earnings and 0.4 times sales. That's likely oversold. But given the amount of uncertainty surrounding the pandemic and the economy's reaction, there is no guarantee the shares will not go lower. And until investors have a reason to get excited about the company's direction again, Textron could be stuck in neutral.