Citi: Illinois Tool Works October Revs. In-Line With Expectations

Buy-rated Illinois Tool Works ITW reported October last three-month base revenue growth of 10%, down slightly from +11% in 3Q10 but above Citi's 4Q10 estimate for +8%. ITW reaffirmed 4Q10 guidance for $0.74-$0.82 that was issued on October 19, as expected. Global growth remains strong, particularly in the key industrial packaging business Signode, along with the other markets that were strong in 3Q10 including welding, electronics, and automotive OEM. Total last three-month revenue growth was 13% versus reaffirmed 4Q guidance for 7%-9%. Total sales growth is trending slightly ahead of Citi's 4Q10 estimate, but we expect growth to moderate throughout the rest of the quarter as prior-year comparisons strengthen. The reaffirmed 4Q10 guidance is also consistent with expectations just one month into the quarter. ITW closed Monday at $48