P/E Ratio

The P/E ratio (price-to-earnings multiple) of 25.1x means investors are paying $25.10 for every $1 of ITW’s annual earnings, which reflects how much the market values each dollar of profit.

This current multiple sits above the sector median of 24.1x, placing ITW in the 54th percentile among its peers, meaning it is slightly more expensive than half the sector. There is no year-over-year change available, and the quarter-over-quarter change is a negligible -0.2%, indicating the ratio has effectively been flat over the available two-quarter window. Because the P/E is already above the sector median yet is not trending lower, the stock carries above-average valuation risk without a compensating downward adjustment in price. This combination of a premium level and a flat trend suggests limited margin of safety for new buyers, aligning with a cautious risk assessment. The CAUTIOUS overall verdict is supported, as the elevated P/E relative to peers adds to the case for restraint.

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