Defense companies roll out earnings this week as conflict in the Middle East threatens to expand and the war in Ukraine rages on. RTX jumped on results Tuesday. Lockheed Martin fell after its report. Textron reports Wednesday followed by Hexcel Thursday. Booz Allen Hamilton announces Q3 results Friday.
RTX
RTX reported 2% adjusted earnings growth to $1.29 per share while revenue increased 10% to $19.93 billion. FactSet predicted a 2.4% earnings decrease to $1.24 per share on 9.1% sales growth to $19.74 billion.
RTX's backlog at the end of Q4 stood at a record $196 billion, of which $118 billion was from commercial aerospace and $78 billion from defense.
Full-year adjusted earnings climbed 6% to $5.06 per share, beating views of $5 per share. Adjusted sales for 2023 jumped 11% to $74.3 billion to top FactSet estimates of $74.06 billion.
For 2024, RTX expects adjusted earnings between $5.25 and $5.40 per share while sales range from $78 billion to $79 billion. FactSet forecasts 2024 earnings of $5.28 per share on $79.33 billion in revenue. The defense contractor guided free cash flow of $5.7 billion for the year.
RTX stock spiked 5.4% Tuesday, jumping above an 86.90 buy point for a three-weeks tight pattern within a 39-week base. The move pushed through resistance at the 200-day level, a bullish signal for the stock, and shares are trading above other key technical lines.
Lockheed Martin
Lockheed Martin reported adjusted earnings of $7.79 per share, up 1.4% from last year. Revenue fell for the second quarter in a row on a 0.6% decline to $18.87 billion. GAAP earnings rose 2.4% to $7.58 per share.
FactSet analysts expected a 6.4% earnings decline to $7.29 per share on a 5.5% sales decrease to $17.96 billion.
Full-year adjusted earnings rose 2.2% to $27.82 per share on 2.4% revenue growth to $67.57 billion. Full-year GAAP earnings jumped 27.3% to $27.55 per share. Analysts expected Lockheed Martin to report full-year earnings of $27.23 per share on $66.66 billion in revenue. The company's backlog stood at a record $160.6 billion at year-end. Free cash flow increased 1.6% to $6.23 billion.
For fiscal 2024, Lockheed Martin guided earnings between $25.65 and $26.35 per share while sales range from $68.5 billion to $70 billion. The earnings outlook was shy of analyst predictions of $26.54 per share. FactSet predicts full-year revenue of $68.65 billion.
LMT stock fell 4.2% Tuesday, dropping below its 50-day line and other moving averages.
MarketSmith charts show LMT up about 12% from an October low, but below its converged 10- and 40-week moving averages within a 40-week consolidation.
Textron
Analysts see Textron earnings jumping to $1.53 per share from $1.23 per share last year on 9.1% revenue growth to $3.97 billion.
Textron reported earnings gains of 30% or more the past two quarters while sales increased 9% during that period.
TXT stock has been holding support at its 10-week moving average, below an 81.39 buy point for a flat base after briefly surpassing the entry on Jan. 2.
TXT stock was little-changed Tuesday.
Hexcel, Booz Allen Hamilton
FactSet forecasts Hexcel earnings will increase 25% to 50 cents per share after six quarters of decelerating gains. However, revenue growth is expected to slow for the fourth straight quarter as sales climb 10.5% to $474 million.
HXL stock inched up Tuesday and it's trading below a 74.27 buy point for a double-bottom base.
FactSet forecasts Booz Allen Hamilton earnings will rise 6.5% to $1.14 per share while sales grow 11.6% to $2.54 billion.
BAH stock is nearing a 131.28 buy point for a flat base. Shares were down a fraction Tuesday and swung nearly 2% higher Monday.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
