Analyst Sheila Kahyaoglu of Jefferies maintained a Hold rating on RTX (RTX – Research Report), boosting the price target to $155.00.
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Sheila Kahyaoglu has given her Hold rating due to a combination of factors that influence RTX’s financial outlook. One key aspect is the potential for margin improvement at Pratt & Whitney (P&W), which could see margins rise to mid-teens by 2027, driven by growth in aftermarket services and alignment with industry peers. However, the current margin projections for 2027 still lag behind the average of its peers, indicating room for improvement but also highlighting existing challenges.
Additionally, while there is a significant opportunity for revenue growth from Raytheon’s defense sales, particularly in the European market, the realization of this potential depends on increased defense spending in the region. The forecasted free cash flow (FCF) growth also presents a positive outlook, but the achievement of the higher $10 billion FCF target by 2027 remains uncertain. These factors contribute to a cautious stance, leading to the Hold rating as the company navigates both opportunities and challenges in its strategic initiatives.
Based on the recent corporate insider activity of 47 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of RTX in relation to earlier this year.