RTX (RTX) AI Stock Analysis

• Market Cap: $171.24B
• Dividend Yield: 2.01%
• Average Volume (3M): 5.59M
• Price to Earnings (P/E): 36.1
• Beta (1Y): 0.57
• Revenue Growth: 15.11%
• EPS Growth: 34.14%
• Country: US
• Employees: 185,000
• Sector: Industrials
• Sector Strength: 74
• Industry: Aerospace & Defense
• EPS (TTM): 1.54
• Shares Outstanding: 1,335,090,000
• 10 Day Avg. Volume: 6,054,034
• 30 Day Avg. Volume: 5,592,828
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.18
• Price to Cash Flow (P/CF): 28.20
• P/FCF Ratio: 23.00
• Enterprise Value/Market Cap: 1.14
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 12.69
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $139.50
• Price Target Upside: 11.40% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

RTX demonstrates strong financial performance with robust revenue growth and profitability, supported by a solid balance sheet and strong cash flow generation. The technical analysis suggests mixed momentum with a cautious outlook due to negative MACD and neutral RSI. Valuation metrics indicate potential overvaluation concerns given the high P/E ratio, although the dividend yield offers moderate income potential. The latest earnings call reinforces a positive outlook with notable growth and strategic positioning, despite some challenges related to tariffs and supply chains.

Positive Factors

Earnings Potential

Rising defence spending globally amid escalating geopolitical tensions could further bolster an already substantial and growing defence backlog, lifting the potential for positive earnings surprises.

Financial Performance

RTX Corporation reported first-quarter sales of $20.3 billion, surpassing estimates, with strong performance in its Collins Aerospace and Pratt & Whitney divisions.

Market Position

RTX is well positioned in the commercial OEM market, benefiting from enduring demand at both Airbus and Boeing.

Negative Factors

Earnings Growth

RTX should trade at a discount relative to other commercially focused aerospace and defence companies due to its relatively sluggish earnings growth and potential event risk from greater-than-anticipated issues with the GTF engines.

Supply Chain Challenges

Supply chain bottlenecks—particularly around structural castings, isothermal forgings, and rocket motors—remain a headwind.

Tariff Impact

The recent enactment of incremental U.S. and non-U.S. tariffs is expected to have a cost impact on RTX, affecting their operations in North America, China, and other parts of the world.

RTX Business Overview & Revenue Model

Company Description

RTX Corporation, formerly known as Raytheon Technologies, is a prominent multinational aerospace and defense conglomerate. The company operates through three primary business segments: Collins Aerospace, Pratt & Whitney, and Raytheon Intelligence & Space. Collins Aerospace specializes in providing advanced systems for commercial and military aircraft, while Pratt & Whitney is renowned for its design and manufacture of aircraft engines. Raytheon Intelligence & Space focuses on developing innovative solutions in the fields of cybersecurity, intelligence, surveillance, and reconnaissance.

How the Company Makes Money

RTX Corporation generates revenue primarily through the sale of aerospace and defense products and services. Its key revenue streams include the production and servicing of aircraft engines through its Pratt & Whitney segment, and the development of avionics and communication systems within Collins Aerospace. Additionally, the Raytheon Intelligence & Space segment contributes significantly by providing defense electronics, air and missile defense systems, and cybersecurity solutions to both governmental and commercial clients. The company also benefits from long-term contracts and partnerships with the U.S. government and other international defense organizations, which provide a steady stream of income through both initial sales and ongoing service and maintenance agreements.

RTX Financial Statement Overview

Summary

RTX displays robust financial health with consistent revenue growth and strong profitability metrics. The company maintains a healthy balance sheet with manageable leverage and a solid equity base. Cash flow generation is strong, supporting operational and strategic initiatives. Overall, RTX is well-positioned in the Aerospace & Defense industry, demonstrating financial resilience and growth potential.

Income Statement

RTX demonstrates strong revenue growth, with a notable increase in total revenue from $68.92 billion in 2023 to $81.739 billion TTM. Gross profit margin improved to 39.3% in TTM, indicating efficient cost management. Despite a slight dip in net income from 2024, the overall trajectory remains positive with a strong EBIT margin of 9.3% and EBITDA margin of 13.7% in TTM, showcasing operational efficiency.

Balance Sheet

The balance sheet reflects a solid equity base with stockholders' equity of $61.516 billion in TTM, with a stable equity ratio of 37.3%. The debt-to-equity ratio stands at 0.65, indicating manageable leverage levels. Return on equity is 7.6% in TTM, slightly lower than previous years, suggesting moderate efficiency in generating returns.

Cash Flow

RTX's cash flow performance is strong, with a free cash flow growth rate of 13.97% from 2024 to TTM. The operating cash flow to net income ratio is 1.73, indicating strong cash generation relative to net income. Free cash flow to net income ratio is 1.1 in TTM, reflecting healthy liquidity and operational cash conversion.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
80.74B	68.92B	67.07B	64.39B	56.59B
	Gross Profit
15.41B	12.09B	13.67B	12.49B	8.53B
	EBIT
6.54B	3.56B	7.30B	6.90B	2.20B
	EBITDA
12.53B	9.61B	11.17B	10.56B	2.95B
	Net Income Common Stockholders
4.77B	3.19B	5.20B	3.86B	-2.93B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.58B	6.59B	6.22B	7.83B	8.80B
	Total Assets
162.86B	161.87B	158.86B	161.40B	162.15B
	Total Debt
40.54B	45.24B	33.50B	33.14B	33.34B
	Net Debt
34.96B	38.65B	27.28B	25.31B	24.54B
	Total Liabilities
100.90B	100.42B	84.65B	86.70B	88.27B
	Stockholders Equity
60.16B	59.80B	72.63B	73.07B	72.16B
Cash Flow		Free Cash Flow
4.53B	4.72B	4.39B	4.75B	1.64B
	Operating Cash Flow
7.16B	7.88B	7.17B	7.07B	3.61B
	Investing Cash Flow
-2.63B	-3.04B	-2.83B	-1.36B	3.10B
	Financing Cash Flow
-6.62B	-4.53B	-5.86B	-6.68B	-5.27B

RTX Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 125.22
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RTX, the sentiment is Positive. The current price of 125.22 is below the 20-day moving average (MA) of 126.13, below the 50-day MA of 128.13, and above the 200-day MA of 120.64, indicating a neutral trend. The MACD of -1.82 indicates Positive momentum. The RSI at 48.43 is Neutral, neither overbought nor oversold. The STOCH value of 55.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RTX.

RTX Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GD	80 Outperform	$73.00B	18.88	18.23%	2.09%	14.11%	17.65%
LMT	79 Outperform	$111.91B	20.63	82.55%	2.70%	3.12%	-15.29%
RTX	73 Outperform	$171.24B	36.10	7.54%	2.01%	15.11%	34.14%
NOC	73 Outperform	$68.11B	18.62	25.41%	1.74%	0.61%	77.28%
GE	71 Outperform	$211.60B	30.94	28.09%	0.74%	-42.92%	109.75%
Sector *	63 Neutral	$4.27B	11.36	5.38%	214.64%	4.14%	-9.01%
BA	52 Neutral	$134.18B	―	-162.23%	―	-9.15%	-406.76%

RTX Corporate Events

RTX Announces Leadership Transition with New Chairman

On February 3, 2025, RTX Corporation announced that Gregory J. Hayes will step down as Executive Chairman and Board member on April 30, 2025, transitioning to a Special Advisor role to the CEO until January 2, 2026. Christopher T. Calio, currently President and CEO, will also assume the role of Chairman, effective April 30, 2025. Hayes, who has led RTX through significant industry changes, will continue with a base salary of $1,100,000 but will forgo annual incentives for 2025. This leadership change is expected to sustain RTX’s strategic priorities and growth trajectory, reinforcing its operations and stakeholder relations.