RTX
RTX
$209.91
-1.12%
RTX Corporation is a global aerospace and defense manufacturer formed from the merger of United Technologies and Raytheon, operating through three primary segments: Collins Aerospace, Pratt & Whitney, and Raytheon. As a diversified supplier to both commercial aerospace and defense markets, RTX holds a leading position in aircraft engines, avionics, and missile systems, making it a critical player in the industry. The current investor narrative centers on record defense spending and geopolitical tensions, which are driving robust demand and backlog growth, while the company also benefits from a recovery in commercial aviation. Recent news highlights RTX as a key beneficiary of soaring defense budgets and supply shortages, with analysts expressing optimism about its long-term growth prospects.…
RTX
RTX
$209.91
Related headlines
Investment Opinion: Should I buy RTX Today?
Rating: Buy. RTX is a high-quality aerospace and defense leader with strong growth prospects, supported by record defense budgets and a commercial recovery. The consensus is Buy, and the average target of $232.27 offers modest upside, but the stock's defensive characteristics and long-term growth justify a Buy for investors with a multi-year horizon.
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RTX 12-Month Price Forecast
RTX is positioned for steady growth driven by defense spending and commercial recovery. The valuation is rich but justified by strong fundamentals. The AI stance is bullish with medium confidence, as the stock's low beta and strong cash flow provide downside support. Upgrades would occur if revenue growth accelerates above 10% or margins exceed 12%, while downgrades would follow if defense budgets are cut or commercial aerospace weakens.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on RTX's 12-month outlook, with a consensus price target around $234.82 and implied upside of +11.9% versus the current price.
Average Target
$234.82
0 analysts
Implied Upside
+11.9%
vs. current price
Analyst Count
—
covering this stock
Price Range
$200 - $265
Analyst target range
RTX is covered by 22 analysts, with a consensus recommendation of 'Buy' and a mean rating of 1.87 (where 1 is Strong Buy and 5 is Sell). The average target price is $232.27, implying a modest upside of 4.2% from the current price of $222.97. The distribution leans bullish, with no Sell ratings and a majority of Buy or Overweight ratings. The target price range spans from a low of $183.98 to a high of $265.00, representing a wide spread of $81.02, which indicates significant uncertainty about the stock's future performance. The high target assumes continued strong defense spending and successful execution of the commercial aerospace recovery, while the low target reflects potential risks such as margin compression or geopolitical disruptions. Recent ratings actions include an upgrade from Jefferies from Hold to Buy in June 2026, while other firms like Morgan Stanley and UBS have maintained their Overweight and Neutral ratings, respectively.
Bulls vs Bears: RTX Investment Factors
RTX presents a balanced risk/reward profile. The bull case is supported by record defense spending, strong backlog, and improving margins, while the bear case centers on a rich valuation and limited upside to analyst targets. Currently, the bull case has slightly stronger evidence given the momentum in defense budgets and the company's operational execution. The most important tension is whether the market's premium valuation is justified by sustained earnings growth; if defense spending decelerates or margins compress, the stock could face multiple compression. Conversely, if RTX continues to beat estimates and raise guidance, the premium may be warranted.
Bullish
- Record defense backlog and geopolitical tailwinds: RTX is a prime beneficiary of record US defense spending, with the 2027 budget projected at $1.5 trillion. Geopolitical tensions, such as the Iran strikes in June 2026, have directly boosted defense stocks, and RTX's Raytheon segment is well-positioned to capture incremental demand.
- Strong revenue growth and margin expansion: Q1 2026 revenue grew 8.7% YoY to $22.08B, with net margin expanding to 9.3% from 7.6% a year ago. Operating margin rose to 11.6% from 10.0%, demonstrating operational leverage and cost discipline across all three segments.
- Analyst consensus is Buy with upside potential: With 22 analysts, the consensus is Buy (mean rating 1.87), and the average target price of $232.27 implies a 4.2% upside from the current price of $222.97. The high target of $265 suggests 18.9% upside if defense spending accelerates.
- Low beta provides defensive characteristics: RTX's beta of 0.294 is significantly lower than the market, indicating lower volatility. This makes it an attractive defensive holding, especially in uncertain macro environments, while still offering growth from defense and commercial aerospace recovery.
Bearish
- Premium valuation relative to industry: RTX trades at a trailing P/E of 36.5x, a 66% premium to the industry average of 22x. Even on a forward basis (28.4x), the stock is expensive, implying high expectations for earnings growth that may not materialize.
- Limited upside to analyst targets: The average analyst target of $232.27 is only 4.2% above the current price, suggesting the stock is fairly valued or slightly overvalued. The low target of $183.98 implies a potential downside of 17.5% if risks materialize.
- Geopolitical risk could reverse gains: While tensions boost defense stocks, escalation could lead to broader market sell-offs, impacting RTX despite its low beta. The stock's recent rally to near 52-week highs may be vulnerable to profit-taking if geopolitical tensions de-escalate.
- Commercial aerospace recovery is uneven: Pratt & Whitney's engine issues and supply chain constraints could hamper growth. Q1 2026 revenue growth of 8.7% is solid but not exceptional, and any slowdown in commercial air travel or production could pressure results.
RTX Technical Analysis
RTX is in a strong uptrend, with the stock up 43.78% over the past year, significantly outperforming the S&P 500's 20.37% gain. The current price of $222.97 is near the top of its 52-week range, sitting at approximately 98.3% of the high of $226.88 and 48% above the low of $150.61. This positioning near the highs indicates strong momentum and investor confidence, though it also raises the risk of overextension. The stock's beta of 0.294 suggests it is much less volatile than the market, which is unusual for a defense stock and may reflect its defensive characteristics.
Beta
0.29
0.29x market volatility
Max Drawdown
-19.3%
Largest decline past year
52-Week Range
$151-$227
Price range past year
Annual Return
+34.3%
Cumulative gain past year
| Period | RTX Return | S&P 500 |
|---|---|---|
| 1m | +7.7% | +2.5% |
| 3m | +18.6% | +2.7% |
| 6m | +2.4% | +11.1% |
| 1y | +34.3% | +20.5% |
| ytd | +12.1% | +12.3% |
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RTX Fundamental Analysis
RTX's revenue has been growing steadily, with the most recent quarter (Q1 2026) reporting revenue of $22.08 billion, up 8.7% year-over-year. This growth is driven by strong demand across all segments, with Collins Aerospace contributing $7.60 billion, Pratt & Whitney $8.17 billion, and Raytheon $6.95 billion in revenue. The company's net income for Q1 2026 was $2.06 billion, with a net margin of 9.3%, up from 7.6% in the year-ago quarter, indicating improving profitability. Gross margin expanded to 20.8% from 20.3% in Q1 2025, and operating margin rose to 11.6% from 10.0%, reflecting operational leverage and cost discipline.
Quarterly Revenue
$22.1B
2026-03
Revenue YoY Growth
+8.7%
YoY Comparison
Gross Margin
20.8%
Latest Quarter
Free Cash Flow
$8.4B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is RTX Overvalued?
Given RTX's positive net income, the trailing P/E ratio of 36.53x is the primary valuation metric, while the forward P/E of 28.39x suggests the market expects earnings growth. The gap between trailing and forward P/E implies an anticipated EPS increase of about 28.7%, which is supported by analyst estimates of $10.33 EPS for the next fiscal year. Compared to the industry average P/E of 22x (based on available data), RTX trades at a 66% premium, which may be justified by its strong growth, dominant market position, and robust backlog. Historically, RTX's P/E has ranged from 18.9x to 311x over the past few years, with the current 36.5x near the higher end of its recent band, indicating that the market is pricing in optimistic expectations.
PE
36.5x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 19x~38x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
18.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks include a high debt load (debt-to-equity of 0.61) and interest expense of $406M in Q1 2026, which could pressure earnings if rates rise. The company's net margin of 9.3% is improving but still below peers, and any cost overruns on fixed-price defense contracts could erode profitability. Additionally, the payout ratio of 53% limits dividend growth potential, and free cash flow of $8.36B must cover debt service and capex.