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ITW vs TKR
Which Stock Would AI Choose? Illinois Tool Works (ITW) vs. Timken (TKR) Stock Comparison
Key Takeaways
- Illinois Tool Works (ITW) delivered record operating margins above 26% in 2025, supported by its proprietary enterprise initiatives and a highly diversified seven-segment industrial portfolio.
- Timken (TKR) posted full-year 2025 adjusted EPS of $5.33 with strong free cash flow growth of nearly 33%, though net income margins contracted versus the prior year amid tariff headwinds.
- Both companies are guiding for 2% to 4% revenue growth in 2026, but ITW's substantially larger scale ($16 billion in 2025 revenue) and 26.3% operating margin dwarf TKR's $4.6 billion revenue base and 17.4% adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) margin.
- ITW extended its dividend growth streak to 62 consecutive years, while TKR marked its 12th consecutive year of dividend increases — both signaling durable shareholder-return cultures.
- Tariff exposure is a shared headwind, but ITW effectively offset tariff costs through pricing and supply chain actions in 2025, whereas TKR faced an estimated $10 million net tariff drag for the year.
Introduction
Industrial stocks often attract investors seeking exposure to the underlying health of the global economy. Illinois Tool Works and Timken both occupy prominent positions in the industrial manufacturing landscape, yet they differ markedly in scale, margin profile, and end-market composition. This stock comparison examines how these two companies have performed in recent quarters, what market sentiment has looked like, and how their respective business models position them for the period ahead. Whether you are a long-term dividend-oriented investor or a trader assessing relative momentum in the industrial sector, understanding the contrasts between ITW and TKR can offer useful perspective.
ITW Overview and Recent Performance
Illinois Tool Works is a Fortune 300 global multi-industrial manufacturer with approximately 43,000 employees and a diversified portfolio spanning seven segments — ranging from automotive OEM (original equipment manufacturer) and food equipment to welding, test and measurement, construction products, specialty products, and polymers and fluids. The company generated roughly $16 billion in revenue for full-year 2025, with GAAP (generally accepted accounting principles) earnings per share of $10.49, slightly exceeding the midpoint of its prior guidance.
In recent months, ITW has stood out for its exceptional margin performance. The company posted a record operating margin of 27.4% in the third quarter of 2025 and closed the full year at 26.3%, driven by enterprise initiatives that contributed approximately 130 basis points. Six of seven segments expanded margins during the year, with three achieving margins above 30%. The company's Customer-Back Innovation strategy contributed 2.4% to revenue growth in 2025. ITW also returned $3.3 billion to shareholders through dividends and share repurchases and raised its dividend for the 62nd consecutive year. Looking ahead, management has guided for 2026 GAAP EPS of $11.00 to $11.40, implying approximately 7% earnings growth at the midpoint, supported by projected revenue growth of 2% to 4%.
TKR Overview and Recent Performance
The Timken Company is a global technology leader in engineered bearings and industrial motion products, headquartered in North Canton, Ohio. The company operates through two primary segments: Engineered Bearings and Industrial Motion, serving markets that include renewable energy, aerospace, rail, heavy industries, and automation. For full-year 2025, Timken recorded sales of approximately $4.6 billion, essentially flat versus 2024, while organic revenue declined about 1%.
Recent market activity has reflected mixed signals for TKR. The company delivered adjusted EPS of $5.33 in 2025, down from $5.79 in the prior year, as net income margins contracted by 140 basis points to 6.3%. Tariff-related costs remain a persistent headwind — Timken estimated roughly $70 million in total tariff costs for 2025, of which approximately $60 million was offset through pricing and surcharges, leaving a net drag of about $10 million. On the positive side, free cash flow surged nearly 33% to $406 million, and the company reduced net debt while continuing its dividend growth streak for a twelfth consecutive year. Under new CEO Lucian Boldea, Timken has signaled an "80/20 mindset" to structurally improve margins and accelerate growth in high-return verticals. The company's initial 2026 guidance calls for adjusted EPS of $5.50 to $6.00 on revenue growth of 2% to 4%.
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Head-to-Head Comparison
While both ITW and TKR operate in industrial manufacturing, the scale differential is stark. ITW's $16 billion revenue base is nearly 3.5 times larger than TKR's, and its operating margin of 26.3% is roughly double Timken's operating margin. ITW's decentralized entrepreneurial culture and proprietary business model have produced best-in-class profitability over decades, while TKR is now pursuing a margin-improvement strategy under new leadership — a process that is still in its early stages.
In terms of sector exposure, ITW's seven-segment structure provides natural diversification across automotive, food service, construction, welding, electronics, and specialty products. TKR's portfolio is more concentrated in bearings and motion systems, with significant exposure to cyclical industrial end markets, renewable energy, and aerospace. This concentration can amplify upside during industrial expansions but also increase sensitivity to downturns. On tariff resilience, ITW demonstrated in 2025 that its pricing power and supply chain flexibility allowed it to fully offset tariff costs, whereas TKR absorbed a net negative impact despite mitigation efforts.
From a shareholder-return perspective, both companies are reliable dividend payers — ITW with 62 years of consecutive increases and a current yield near 2.3%, and TKR with 12 years of increases. However, ITW's share repurchase program is far larger in absolute terms, with $1.5 billion planned for 2026, compared with TKR's more modest buyback activity. Market sentiment in recent months has generally favored ITW's consistency, with analysts noting its ability to outperform end markets and expand margins even amid sluggish organic growth. TKR has drawn more mixed reviews, with investors weighing the potential upside from its strategic repositioning against near-term earnings pressure.
Tickeron AI Verdict
Based on observable factors such as trend consistency, margin stability, diversification breadth, and relative positioning in the current market environment, Tickeron's AI would likely lean toward Illinois Tool Works as the more favorable candidate in this comparison. ITW enters 2026 with record-level operating margins, a proven ability to neutralize tariff impacts, seven-for-seven segment growth expectations, and a 62-year dividend growth track record that signals durable competitive advantages. Timken offers a potentially higher-beta recovery play if industrial markets accelerate, and its new strategic direction under CEO Boldea could unlock meaningful upside over time, but the company's margin profile and recent earnings trajectory introduce greater near-term uncertainty. For traders and investors who prioritize stability, wide competitive moats, and consistent execution across economic cycles, ITW presents a more probabilistically grounded case, while TKR may appeal to those willing to accept higher variability in pursuit of a turnaround narrative.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is ITW is a StrongBuy and TKR is a StrongBuy.
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is undervalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
ITW’s FA Score shows that 2 FA rating(s) are green whileTKR’s FA Score has 2 green FA rating(s).
- ITW’s FA Score: 2 green, 3 red.
- TKR’s FA Score: 2 green, 3 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
ITW’s TA Score shows that 5 TA indicator(s) are bullish while TKR’s TA Score has 3 bullish TA indicator(s).
- ITW’s TA Score: 5 bullish, 5 bearish.
- TKR’s TA Score: 3 bullish, 4 bearish.
Price Growth
ITW (@Industrial Machinery) experienced а -2.14% price change this week, while TKR (@Tools & Hardware) price change was +2.32% for the same time period.
The average weekly price growth across all stocks in the @Industrial Machinery industry was -1.71%. For the same industry, the average monthly price growth was -9.60%, and the average quarterly price growth was -6.22%.
The average weekly price growth across all stocks in the @Tools & Hardware industry was +0.28%. For the same industry, the average monthly price growth was -0.39%, and the average quarterly price growth was +9.47%.
Reported Earning Dates
ITW is expected to report earnings on Jul 28, 2026.
TKR is expected to report earnings on Aug 05, 2026.
Industries' Descriptions
@Industrial Machinery (-1.71% weekly)The industry makes and maintains machines for consumers, the industry, and most other companies. While it has traditionally been categorized as heavy industry, some smaller companies are also branching into the light category. The industry is pivotal in providing the equipment for production in businesses like agriculture, mining, industry and construction, gas, electricity and water utilities. It also supplies supporting equipment for almost all sectors of the economy, such as equipment for heating, and air conditioning of buildings. Illinois Tool Works Inc., Parker-Hannifin Corporation and Rockwell Automation Inc are some of the major U.S. companies operating in this industry.
@Tools & Hardware (+0.28% weekly)Tools & Hardware industry includes companies that manufacture security products, storage cabinets, steel rules and tapes, calipers, shoe hook fasteners, lumber, structural materials and other related supplies. Stanley Black & Decker, Inc., Snap-on Incorporated and L.S. Starrett Company are some of the largest, established players in this industry. The industry is also seeing rapid growth in online sales. The proliferation of do-it-yourself (DIY) projects has boosted industry demand. But oil price volatility poses potential risks to this industry, particularly to e-commerce companies which spend on services of shipping companies, which might alter charges based on oil price movements.
| ITW | TKR | ITW / TKR | |
| Capitalization | 79.7B | 9.79B | 814% |
| EBITDA | 4.74B | 783M | 605% |
| Gain YTD | 13.824 | 68.551 | 20% |
| P/E Ratio | 25.71 | 32.02 | 80% |
| Revenue | 16.2B | 4.67B | 347% |
| Total Cash | N/A | 345M | - |
| Total Debt | 9.15B | 2.2B | 415% |
ITW | TKR | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 27 | 64 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 20 Undervalued | 82 Overvalued | |
PROFIT vs RISK RATING 1..100 | 39 | 24 | |
SMR RATING 1..100 | 12 | 72 | |
PRICE GROWTH RATING 1..100 | 37 | 38 | |
P/E GROWTH RATING 1..100 | 35 | 11 | |
SEASONALITY SCORE 1..100 | 50 | 10 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
ITW's Valuation (20) in the Industrial Machinery industry is somewhat better than the same rating for TKR (82) in the Metal Fabrication industry. This means that ITW’s stock grew somewhat faster than TKR’s over the last 12 months.
TKR's Profit vs Risk Rating (24) in the Metal Fabrication industry is in the same range as ITW (39) in the Industrial Machinery industry. This means that TKR’s stock grew similarly to ITW’s over the last 12 months.
ITW's SMR Rating (12) in the Industrial Machinery industry is somewhat better than the same rating for TKR (72) in the Metal Fabrication industry. This means that ITW’s stock grew somewhat faster than TKR’s over the last 12 months.
ITW's Price Growth Rating (37) in the Industrial Machinery industry is in the same range as TKR (38) in the Metal Fabrication industry. This means that ITW’s stock grew similarly to TKR’s over the last 12 months.
TKR's P/E Growth Rating (11) in the Metal Fabrication industry is in the same range as ITW (35) in the Industrial Machinery industry. This means that TKR’s stock grew similarly to ITW’s over the last 12 months.
| ITW | TKR | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 32% | 2 days ago 61% |
| Stochastic ODDS (%) | 2 days ago 45% | 2 days ago 66% |
| Momentum ODDS (%) | 2 days ago 59% | 2 days ago 73% |
| MACD ODDS (%) | 2 days ago 40% | 2 days ago 56% |
| TrendWeek ODDS (%) | 2 days ago 46% | 2 days ago 67% |
| TrendMonth ODDS (%) | 2 days ago 50% | 2 days ago 60% |
| Advances ODDS (%) | 2 days ago 51% | 3 days ago 65% |
| Declines ODDS (%) | 5 days ago 40% | 9 days ago 61% |
| BollingerBands ODDS (%) | 2 days ago 40% | N/A |
| Aroon ODDS (%) | 2 days ago 39% | 2 days ago 58% |
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ITW and
Correlation & Price change
A.I.dvisor indicates that over the last year, ITW has been closely correlated with GGG. These tickers have moved in lockstep 74% of the time. This A.I.-generated data suggests there is a high statistical probability that if ITW jumps, then GGG could also see price increases.
TKR and
Correlation & Price change
A.I.dvisor indicates that over the last year, TKR has been closely correlated with SWK. These tickers have moved in lockstep 74% of the time. This A.I.-generated data suggests there is a high statistical probability that if TKR jumps, then SWK could also see price increases.