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RTX Corporation (RTX), based in Arlington, Virginia, is a prominent aerospace and defense company. Valued at $161.1 billion by market cap, it provides a wide range of aviation and defense systems, including avionics, communication, navigation equipment, and engine components. The defense titan is expected to announce its fiscal third-quarter earnings for 2024 before the market opens on Tuesday, October 22.
Ahead of the event, analysts expect RTX to report a profit of $1.33 per share on a diluted basis, up 6.4% from $1.25 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports. Its EPS of $1.41 beat the consensus estimate by 9.3% in the previous quarter, thanks to a rebound in the broader commercial aviation sector.
For fiscal year 2024, analysts expect RTX to report EPS of $5.45, up 7.7% from $5.06 in fiscal 2023.
RTX stock has outperformed the S&P 500’s ($SPX) 19.7% gains on a YTD basis, with shares up 47.8% during this period. Similarly, it outshined the S&P 500 Industrial Sector SPDR’s (XLI) 18.9% returns over the same time frame.
RTX has outperformed the broader market in 2024 primarily due to two key factors: raising its full-year guidance and successfully managing the risks related to its geared turbofan (GTF) engine inspection and removal program. This derisking of the stock, along with solid performance in its commercial aerospace businesses, particularly aftermarket sales, has helped boost investor confidence and drive its stock higher despite challenges in its defense segment.
Additionally, increased tensions in the Middle East have boosted RTX shares, which closed up over 2% on Oct. 1, as defense stocks rallied across the market. On the same day, the company’s business, Pratt & Whitney, celebrated the opening of its new 845,000-square-foot facility in Oklahoma City, strengthening its position as the largest military engines field location. The $255 million investment will support growing demand for the F135, F117, TF33, F100, and F119 engines from U.S. and global defense customers.
Analysts’ consensus opinion on RTX stock is reasonably bullish, with a “Moderate Buy” rating overall. Out of 21 analysts covering the stock, six advise a “Strong Buy” rating, 14 have a “Hold” rating, and the remaining analyst recommends a “Strong Sell.”
While RTX currently trades above its mean price target of $120.05, the Street-high target of $150 represents a potential upswing of 20.6% from the prevailing price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
