Illinois Tool Works Inc. (NYSE:ITW)

Founded in 1912, Illinois Tool Works manufactures products designed for industrial, construction, electronics and other markets. ITW follows a strategy of growth through acquisition, focusing on products that sell particularly well. The company employs 60,000 employees, in 57 countries and is broken down into eight sectors: industrial packaging (14%), power systems & electronics (12%), transportation (15%), construction (11%), food (13%), decorative surfaces (7%), polymers & fluids (8%), others (20%).

Illinois Tool Works has increased its dividend every year for 48 years, as much as the famous Johnson & Johnson. Little known to the general public, it has nevertheless ended first in Fortune '97's list of America's most admired companiesOne of the strengths of this multi-billion dollar company is that it can count on a network of 840 small, decentralized companies close to the customer.

Not only is the dividend history impressive, but its average annual growth over the past few years stands at a respectable 9.26%. The current average yield stands at 2.8%, slightly higher than the long-term average (2.64%), benefiting from ITW's share price decline since May. In addition, the increase in earnings per share in the first quarter helps maintain a distribution ratio at a particularly low level (36.84%). Volatility, at 15.46%, is higher than our portfolio, but lower than the market.

The PE of 15.10 is attractive not only as such, but also from a historical point of view. Since 2001, apart from 2008-2009, there have hardly been moments when the valuation was lower. ITW, like many stocks in our portfolio, was able to take advantage of the "lost decade" 2000-2010, easily beating the market.

ITW's international sales, and indirectly the share price, are partly benefiting from a fall in the greenback, but are not completely offsetting it.

Illinois Tool Works' dividend fundamentals are therefore all quite good, but not extraordinary, apart from their age. The same goes for the sensitivity to the greenback. These different reasons make us consider ITW as a title to follow, to be followed very closely, but not yet as a buying opportunity.