RTX's unit, Raytheon, secures a $2.13 billion contract to support the SM-3 missile program.
Recently, Zacks.com users have been paying close attention to RTX (RTX). This makes it worthwhile to examine what the stock has in store.
Investors interested in RTX stock should wait for a better entry point, considering its premium valuation and downward revision in earnings estimates.
Since my last analysis, two key catalysts have been evolving around LMT and RTX stock. The unprecedented rise in global military expenditure and the efforts from DOGE (Department of Government Efficiency) could generate mixed impacts. The positives can more than offset the negatives in my model, leading me to have an overall bullish view toward leading defense companies such as LMT and RTX.
RTX (RTX) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
Investors interested in RTX stock should avoid adding it to their portfolio, considering its premium valuation and downward revision in earnings estimates.
RTX Corporation delivered a strong Q1: sales up 5% YoY ($20.3B), EPS rose 10% ($1.47), FCF at $792M; backlog secure at $217B (Commercial: $125B, Defense: $92B), ensuring revenue visibility. Tariffs could hit 2025 pretax profits by ~$850M (7-8% of operating profit); RTX proactively invested $2B in U.S. manufacturing, optimizing supply chain flexibility and pricing strategies to mitigate risk. Current valuation fair (forward non-GAAP P/E: 18.5 vs. 5-yr avg. of 20), RSI at 47.5; 12-month PT of $135 implies ~15% total return, providing geopolitical hedge amid tariff uncertainties.
RTX's Q1 sales grew 8% organically to $20.3 billion, beating analyst expectations with adjusted EPS up 10% to $1.47. Despite strong results, RTX's stock fell 10% due to tariff impacts, with an estimated $850 million hit to operating profit for the year. RTX maintained its guidance, projecting $83-$84 billion in sales and $6-$6.15 EPS, but investors are disappointed by the lack of upward revision.
Investors may stay invested in RTX due to balanced exposure across segments. Lockheed could be more appealing to those seeking attractive valuation.
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RTX Corporation shares fell by more than 10% in an initial reaction to the Q1 2025 results published today. The article provides an update on the company's fundamentals and also in light of the tariffs. I explain why my investment thesis remains intact, but why I will not be adding to my RTX stock position following the post-earnings drop.
RTX stock's first-quarter sales of $20.31 billion surpass the Zacks Consensus Estimate by 3% and surge 5.2% year over year.