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Rtx Corporation (RTX)
:RTX
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RTX (RTX) AI Stock Analysis

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RTX

RTX

(NYSE:RTX)

Rating:76Outperform
Price Target:
$177.00
▲(13.22% Upside)
RTX's overall stock score of 76 reflects strong financial performance and positive earnings call sentiment, indicating robust growth and strategic positioning in the Aerospace & Defense industry. However, technical indicators suggest potential overvaluation, and the high P/E ratio warrants caution. The company's resilience in overcoming operational disruptions and improving sales outlook supports a favorable outlook.
Positive Factors
Defense Demand
Mitchill sees defense demand at a scale not witnessed in recent years, driven by rising EU defense spending and funding for key programs.
Financial Performance
RTX's net tariff drag to EBIT has been reduced, indicating improved financial performance.
International Sales
Early signs of international revenue growth and margin gains on international sales are being observed.
Negative Factors
Supply Chain Challenges
The supply chain continues to face challenges, with fires leading to fastener shortages impacting Collins.
Tariffs Impact
The company expects a ~$500mn headwind from tariffs this year, with $125mn already incurred in the first half.

RTX (RTX) vs. SPDR S&P 500 ETF (SPY)

RTX Business Overview & Revenue Model

Company DescriptionRTX Corporation, an aerospace and defense company, provides systems and services for the commercial, military, and government customers in the United States and internationally. It operates through three segments: Collins Aerospace, Pratt & Whitney, and Raytheon. The Collins Aerospace Systems segment offers aerospace and defense products, and aftermarket service solutions for civil and military aircraft manufacturers and commercial airlines, as well as regional, business, and general aviation, defense, and commercial space operations. This segment also designs, produces, and supports cabin interior, including oxygen systems, food and beverage preparation, storage and galley systems, and lavatory and wastewater management systems; battlespace, test and training range systems, crew escape systems, and simulation and training solutions; information management services; and aftermarket services that include spare parts, overhaul and repair, engineering and technical support, training and fleet management solutions, and asset and information management services. Its Pratt & Whitney segment supplies aircraft engines for commercial, military, business jet, and general aviation customers; and produces, sells, and services military and commercial auxiliary power units. The Raytheon segment provides defensive and offensive threat detection, tracking, and mitigation capabilities for U.S., foreign government, and commercial customers. The company was formerly known as Raytheon Technologies Corporation and changed its name to RTX Corporation in July 2023. RTX Corporation was incorporated in 1934 and is headquartered in Arlington, Virginia.
How the Company Makes MoneyRTX Corporation generates revenue through its three main business segments: Collins Aerospace, Pratt & Whitney, and Raytheon. Collins Aerospace contributes to the company's earnings by offering avionics, cabin systems, and information management services for commercial and military aircraft. Pratt & Whitney earns revenue by manufacturing and servicing commercial and military jet engines, leveraging long-term contracts with airlines and defense departments. The Raytheon segment provides a diverse range of defense and cybersecurity solutions, including missile defense systems, radars, and cybersecurity services, primarily selling to government agencies and international allies. Additionally, strategic partnerships and contracts with various government entities and defense contractors play a crucial role in sustaining and expanding RTX's revenue streams.

RTX Key Performance Indicators (KPIs)

Any
Any
Operating Margin by Segment
Operating Margin by Segment
Reveals profitability across different business units, highlighting which segments drive earnings and where there might be room for improvement or strategic focus.
Chart InsightsCollins Aerospace's operating margin shows a steady recovery post-2020, reflecting strategic resilience. Pratt and Whitney's margin faced a significant dip in late 2023 but rebounded, aligning with increased MRO output and defense sales growth. Intelligence and Space, and Missiles and Defense segments have ceased reporting margins, potentially indicating strategic shifts or restructuring. Raytheon's margin has stabilized post-2023, despite a sales decline due to divestitures. The earnings call highlights robust financial performance and backlog growth, yet tariff impacts and supply chain concerns could pose future risks.
Data provided by:Main Street Data

RTX Earnings Call Summary

Earnings Call Date:Jul 22, 2025
(Q2-2025)
|
% Change Since: 3.15%|
Next Earnings Date:Oct 28, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a strong performance in terms of sales growth, backlog, and strategic wins, with positive adjustments to sales and EPS outlooks. However, the company faced challenges due to tariffs, cash flow issues, and operational disruptions at Pratt & Whitney.
Q2-2025 Updates
Positive Updates
Strong Organic Sales Growth
RTX reported a 9% organic sales growth year-over-year, driven by 16% growth in commercial aftermarket sales.
Record Backlog and Book-to-Bill Ratio
The company achieved a book-to-bill ratio of 1.86 with a backlog of $236 billion, up 50% year-over-year.
Significant Wins in Engine Orders and Defense Contracts
Pratt booked over 1,000 GTF engine orders, and Raytheon secured over $5 billion in integrated air and missile defense awards.
Increased Sales and EPS Outlook
RTX raised its full-year adjusted sales outlook to $84.75 billion to $85.5 billion and adjusted EPS to $5.80 to $5.95.
Dividend Increase
RTX raised its dividend by 8% in the quarter, showing confidence in long-term cash generation.
Negative Updates
Impact of Tariffs
The company faced $500 million in tariff costs for 2025, with $125 million already incurred in the first half.
Free Cash Flow Challenges
The company had a free cash flow outflow of $72 million due to powder metal related compensation and tariff impacts.
Pratt & Whitney Work Stoppage
A 4-week work stoppage at Pratt affected free cash flow and operating profit.
Lowered Pratt Operating Profit Expectations
Operating profit growth expectations for Pratt were revised down due to tariffs and other factors.
Company Guidance
During the RTX Second Quarter 2025 Earnings Conference Call, the company reported a 9% year-over-year organic sales increase, driven by a 16% rise in commercial aftermarket sales and a 12% boost in segment operating profit. The book-to-bill ratio stood at an impressive 1.86, with a backlog reaching $236 billion, marking a 50% increase year-over-year. Free cash flow was approximately breakeven due to a temporary work stoppage at Pratt, expected to recover later in the year. RTX revised its full-year guidance, projecting adjusted sales between $84.75 billion and $85.5 billion, up from previous expectations, and adjusted EPS in the range of $5.80 to $5.95, reflecting a $0.10 EPS improvement from operational performance. The company maintained its full-year free cash flow outlook between $7 billion and $7.5 billion, despite tariff-related headwinds.

RTX Financial Statement Overview

Summary
RTX exhibits strong financial health with consistent revenue and profit growth, robust cash flow generation, and efficient capital management. Despite a high leverage ratio, the company maintains a stable equity position and continues to improve profitability metrics, making it a solid player in the Aerospace & Defense industry.
Income Statement
85
Very Positive
RTX has shown a strong growth trajectory with revenue growth from $56.59B in 2020 to $83.60B in the TTM period, reflecting a solid upward trend. The gross profit margin is at a respectable level, indicating efficient cost management. EBIT and EBITDA margins have improved over time, demonstrating enhanced operational efficiency. The net profit margin also shows positive growth, underlining increased profitability.
Balance Sheet
78
Positive
RTX maintains a healthy equity ratio, suggesting a stable financial position. However, the debt-to-equity ratio is relatively high, which could imply potential leverage risk. Despite this, the return on equity has shown improvement, indicating effective use of shareholder funds to generate profit.
Cash Flow
80
Positive
The company has demonstrated robust operating cash flow generation, which covers net income comfortably, highlighting strong cash conversion capabilities. Free cash flow has seen growth, although it has fluctuated over the years. The free cash flow to net income ratio is healthy, supporting the company's ability to generate cash after accounting for capital expenditures.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue83.60B80.74B68.92B67.07B64.36B56.67B
Gross Profit16.76B15.41B12.09B13.67B12.50B9.01B
EBITDA14.32B12.16B9.37B11.17B10.56B2.95B
Net Income6.15B4.77B3.19B5.20B3.86B-3.52B
Balance Sheet
Total Assets167.14B162.86B161.87B158.86B161.40B162.15B
Cash, Cash Equivalents and Short-Term Investments4.78B5.58B6.59B6.22B7.83B8.80B
Total Debt43.59B42.89B45.24B33.50B33.14B33.34B
Total Liabilities102.89B100.90B100.42B84.65B86.70B88.27B
Stockholders Equity62.40B60.16B59.80B72.63B73.07B72.16B
Cash Flow
Free Cash Flow3.05B4.53B4.72B4.39B4.75B1.64B
Operating Cash Flow5.85B7.16B7.88B7.17B7.07B3.61B
Investing Cash Flow-2.68B-1.53B-3.04B-2.83B-1.36B3.10B
Financing Cash Flow-4.43B-6.62B-4.53B-5.86B-6.68B-5.27B

RTX Technical Analysis

Technical Analysis Sentiment
Positive
Last Price156.33
Price Trends
50DMA
146.10
Positive
100DMA
137.41
Positive
200DMA
129.29
Positive
Market Momentum
MACD
3.52
Positive
RSI
63.48
Neutral
STOCH
74.54
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 156.33 is above the 20-day moving average (MA) of 152.98, above the 50-day MA of 146.10, and above the 200-day MA of 129.29, indicating a bullish trend. The MACD of 3.52 indicates Positive momentum. The RSI at 63.48 is Neutral, neither overbought nor oversold. The STOCH value of 74.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RTX.

RTX Risk Analysis

RTX disclosed 29 risk factors in its most recent earnings report. RTX reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

RTX Peers Comparison

Overall Rating
UnderperformOutperform
Sector (71)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
82
Outperform
$288.57B37.9940.20%0.48%-32.80%69.39%
76
Outperform
$209.25B34.3510.13%1.64%15.44%164.00%
76
Outperform
$84.40B21.0717.91%1.86%11.85%16.12%
71
Outperform
¥258.06B14.458.48%2.82%6.32%12.21%
71
Outperform
$84.47B21.6926.50%1.45%-0.65%77.20%
64
Neutral
$99.98B24.1173.06%3.05%1.09%-35.50%
56
Neutral
$170.03B-162.23%2.41%-193.57%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
RTX
RTX
156.33
43.60
38.68%
BA
Boeing
224.86
55.99
33.16%
GD
General Dynamics
313.76
28.93
10.16%
GE
GE Aerospace
272.12
107.57
65.37%
LMT
Lockheed Martin
428.24
-109.20
-20.32%
NOC
Northrop Grumman
589.95
107.11
22.18%

RTX Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
RTX Announces Leadership Transition with New Chairman
Neutral
Feb 3, 2025

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025