At least one analyst says Cessna and Bell Helicopter's parent company Textron is ripe for a takeover after its stock price slipped another 18 percent on Tuesday. The latest decline was prompted by Textron's prediction that it will post a net loss of 80 to 90 cents a share in the fourth quarter and that it plans to lay off about 2,000 more people at Cessna and Bell in 2009. The company is also selling off most of its credit arm, leaving only enough to finance products made by its manufacturing facilities. "While the stock will likely remain under a cloud given earnings uncertainty, Textron does have valuable assets and could become a takeover target as [Textron Financial Corp.] diminishes in size," Citi Investment Research analyst Richard Sprague told MarketWatch.
Cessna has already announced hundreds of layoffs in Wichita as the aviation market softens. The drop in Textron's share value is the latest in a year-long slide that has seen the price decrease by 83 percent. Still, the company thinks the measures it's taken will allow it to pull through. "Looking ahead to 2009, we continue to believe that losses at TFC will be manageable. While we expect manufacturing revenues will be down next year, we believe our cost-reduction plans will contribute to our operating performance as we focus to offset the impact of slowing demand," Chairman and CEO Lewis Campbell said, according to a Textron statement.