Aerospace and defense companies, RTX (RTX) and Northrop Grumman (NOC), are set to report fourth-quarter 2025 earnings tomorrow, January 27, 2026. Both companies are expected to benefit from strong demand in the aerospace and defense sector. Also, investors will be watching how Trump’s renewed focus on defense spending and rising geopolitical tensions, especially from conflicts in Eastern Europe to rising security concerns in the Indo-Pacific, are shaping contract pipelines and profits.
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RTX Earnings Preview
Analysts expect RTX to report earnings per share (EPS) of $1.47, slightly lower than $1.54 reported in the last year’s quarter. Meanwhile, revenue is expected to rise 5.1% to $22.7 billion.
Importantly, RTX has a consistent track record of outperforming Wall Street expectations, topping analyst EPS estimates in each of the last 12 quarters. Also, the company’s revenues have seen a strong trend, as shown in the chart below.
Strong demand for commercial jet engines and F-35 military engines is expected to have boosted Q4 sales. However, higher tariffs and supply chain costs may have impacted the bottom line.
It is worth noting that Susquehanna analyst Charles Minervino raised his price target on RTX stock to $230 from $205 while keeping a Buy rating. The analyst noted that conditions in commercial aerospace, defense, and aftermarket remain strong. Also, he pointed to an upbeat outlook across these areas over the medium term as the reason for the price target hike.
Northrop Grumman Earnings Preview
At the same time, Northrop Grumman is expected to deliver solid growth in both top and bottom lines, driven by strong contract wins and key defense programs like the B-21 Raider. Wall Street analysts expect Q4 revenue and earnings to have increased 8.7% and 9.2%, respectively, on a year-over-year basis.
NOC has a decent earnings surprise history, having missed estimates in only one of the past 12 quarters. Further, the company’s revenues have been rising in the past few years, as shown in the graph below.
Seaport Research analyst Richard Safran is optimistic about Northrop Grumman stock, having raised the price target to $772 from $661 and keeping a Buy rating. The analyst believes defense spending will grow strongly and for a longer period than previously thought, which should benefit the company’s business and support higher share prices.
Option Traders Expect a Larger Swing in NOC Stock
Currently, options traders are bracing for a bigger swing in NOC stock compared to RTX as both companies are preparing to report Q4 results tomorrow. This reflects rising expectations from defense spending growth and new contracts, which could lead to surprises in Northrop’s results or guidance.
Based on options pricing, NOC shares are expected to move 6.92% or by $46.55 in either direction following the Q4 results. Meanwhile, the market is expecting a 5.04% move in RTX stock.
Which Stock Is Better, RTX or NOC?
Let’s use the TipRanks Stock Comparison tool to see how Wall Street analysts are rating these stocks and which one they believe has the strongest upside, as shown in the chart below.
