Since September 2025, ITT has been in a holding pattern, posting a small return of 2% while floating around $184.56.
Given the underwhelming price action, is now a good time to buy ITT? Or should investors expect a bumpy road ahead? Find out in our full research report, it’s free.
Why Is ITT a Good Business?
Playing a crucial role in the development of the first transatlantic television transmission in 1956, ITT (NYSE: ITT) provides motion and fluid handling equipment for various industries
1. Long-Term Revenue Growth Shows Strong Momentum
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, ITT grew its sales at a solid 9.7% compounded annual growth rate. Its growth surpassed the average industrials company and shows its offerings resonate with customers.
2. Operating Margin Reveals a Well-Run Organization
Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.
ITT’s operating margin has generally stayed the same over the last 12 months, averaging 17.2% over the last five years. This profitability was elite for an industrials business thanks to its efficient cost structure and economies of scale. This is seen in its fast historical revenue growth and healthy gross margin, which is why we look at all three data points together.
3. Increasing Free Cash Flow Margin Juices Financials
Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
As you can see below, ITT’s margin expanded by 17.6 percentage points over the last five years. This is encouraging, and we can see it became a less capital-intensive business because its free cash flow profitability rose while its operating profitability was flat. ITT’s free cash flow margin for the trailing 12 months was 14.1%.
Final Judgment
These are just a few reasons why we think ITT is a high-quality business, but at $184.56 per share (or 25.6× forward P/E), is now the right time to buy the stock? See for yourself in our in-depth research report, it’s free.
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