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RTX Corporation (RTX), headquartered in Arlington, Virginia, provides systems and services for commercial, military, and government customers in the aerospace and defense industries. Valued at $155.39 billion by market cap, RTX is the world’s largest aerospace and defense company, offering avionics systems, aviation systems, communications and navigation equipment, interior and exterior aircraft lighting, aircraft seating, environmental control systems, flight control systems, and engine components.
Shares of this aerospace and defense giant have outperformed the broader market considerably over the past year. RTX has gained 33.3% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 21.1%. In 2024, RTX stock is up 39.3%, surpassing the SPX’s 16.2% rise on a YTD basis.
Zooming in further, RTX’s outperformance looks more pronounced compared to the S&P 500 Industrial Sector SPDR (XLI). The exchange-traded fund has gained about 15.2% over the past year. Moreover, RTX’s gains on a YTD basis outshine the ETF’s 11.9% returns over the same time frame.
On Jul. 25, RTX shares rose more than 8% after the company reported its Q2 results. Its adjusted EPS of $1.41 surpassed Wall Street estimates of $1.19. The company’s revenue of $19.72 billion beat the consensus estimates of $17.80 billion. The company generated $2.20 billion in free cash flow. RTX had a company backlog of $206 billion, which included $129 billion of commercial and $77 billion of defense.
RTX raised its full-year adjusted EPS guidance to between $5.35 and $5.45, from $5.25 to $5.40. Its revenue guidance was raised to $79.10 billion at the midpoint from $78.50 billion. Moreover, the company expects free cash flow to be approximately $4.70 billion, down from approximately $5.70 billion.
For the current fiscal year, ending in December, analysts expect RTX’s EPS to grow 7.3% to $5.43 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 21 analysts covering RTX stock, the consensus rating is a “Hold.” That’s based on five “Strong Buy” ratings, 15 “Holds,” and one “Strong Sell.”
This configuration is slightly less bullish than three months ago, with six suggesting a “Strong Buy.”
The mean price target of $105.21 represents a 10.5% downside to RTX’s current price levels. However, the Street-high price target of $140 suggests an upside potential of 19.2%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
