Douglas Harned, an analyst from Bernstein, maintained the Hold rating on RTX. The associated price target was raised to $157.00.
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Douglas Harned has given his Hold rating due to a combination of factors impacting RTX’s performance. The company shows strong potential in its Raytheon unit and positive trends at Collins, which are promising for its defense sector outlook. However, challenges at Pratt & Whitney, specifically with the Geared Turbofan (GTF) engine, create significant headwinds that temper the overall positive outlook.
The profitability of Pratt & Whitney’s V2500 aftermarket is a crucial component, but the potential decline in older V2500-powered aircraft could pose challenges in the coming years. Additionally, the high number of grounded GTF-powered planes exceeds RTX’s initial projections, although the company maintains that the associated costs remain within their estimates. Despite efforts to address technical issues with the GTF engines, improvements are not expected until 2026, contributing to a cautious stance on the stock.
Based on the recent corporate insider activity of 40 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.