Textron Inc.

S&P Global Ratings' stable outlook on Textron Inc. reflects our expectation that the company's credit metrics will remain appropriate for the rating in 2018 despite an elevated level of share repurchases. Specifically, we believe that the company's funds from operations (FFO) to debt ratio will be in the 40%-45% range in 2018. And, while we expect the company to use all of its free cash flow for acquisitions and share repurchases, we believe management would reduce its share repurchases if necessary to preserve Textron's credit quality. Although unlikely, we could lower our rating on Textron during the next two years if FFO to debt declines below 40% for a sustained period. This could result from operational issues, weakness in its

...Cessna business jet production likely to increase modestly in 2019, driven by new models and a slowly improving market. Production of Cessna business jets declined significantly after the 2008 financial crisis and has been slowly improving since bottoming out in 2013. We expect modest growth in 2019 as the company begins deliveries of its new Longitude jet and deliveries of legacy models increase as the business jet market sees some signs of life after being depressed for almost a decade. However, this improvement in the market could stall again if U.S. economic growth weakens materially. We expect margins to continue to improve at Textron Aviation as volumes increase, the company rationalizes its product line, and pricing firms up, despite relatively high spending on new models....

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