RTX RTX Corporation - Fundamental Analysis
NEUTRAL
RTX Stock | Fundamental Analysis & Investment Insights
NYSE
•
Industrials
•
Aerospace & Defense
Current Price
$175.57
Analyst Target
$192.06
+9.4% Upside
52W High
$181.31
52W Low
$112.27
At a glance
Key valuation, profitability, growth, and risk metrics.
Updated Nov 15, 2025
Market cap
$235.4B
P/E
36.13
ROE
10.7%
Profit margin
7.7%
Debt/Equity
0.61
Dividend yield
1.55%
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
65%
Analysis Accuracy
RTX Corporation trades at a premium valuation with solid top- and bottom-line growth, outpacing sector averages in revenue and earnings momentum. However, its elevated P/E of 36.13 and forward P/E of 28.73 exceed both sector and peer medians, tempering near-term upside despite strong 1Y and 3Y price performance. Profitability metrics are stable but unexceptional, with ROE of 10.70% lagging peers like GE and CAT, while insider selling over the past six months signals caution at current levels. Analysts maintain a 'buy' recommendation with a $192.06 target, implying ~9% upside, but recent earnings misses and weak quarterly surprise history constrain conviction.
Key Strengths
Revenue growth of 11.90% YoY exceeds sector average of 7.18% and positions RTX favorably within the aerospace & defense subsector
Earnings growth of 29.40% YoY reflects strong operating leverage and cost discipline, outpacing most peers except GE and BA
Debt/Equity of 0.61 is well below sector average of 1.76, indicating conservative capital structure and low refinancing risk
Dividend yield of 1.55% is supported by a sustainable 53.80% payout ratio, offering income appeal in a low-yield environment
Market cap of $235.40B underscores dominant scale and pricing power in defense and aerospace systems
Key Risks
P/E of 36.13 is significantly above sector average of 26.79 and peer CAT (28.48), creating valuation sensitivity to growth deceleration
ROE of 10.70% lags peer group (CAT: 46.28%, GE: 42.13%, DE: 21.40%), suggesting suboptimal capital efficiency
Insider selling of $13.51M over last 6 months, including executive sales, implies lack of confidence at current price levels
Profit margin of 7.67% trails sector average of 9.41%, indicating margin pressure from supply chain or program execution
Zero earnings beats over last 4 quarters with average surprise of 0.00%, signaling deteriorating forecasting accuracy or execution risk
AI Fair Value Estimate
Based on comprehensive analysis
$192.06
+9.4% above current price
Performance Snowflake
Multi-dimensional analysis across 5 key categories
Overall
65
Strong
48
70
58
72
75
AI Verdict
RTX demonstrates solid growth and financial health but trades at a steep valuation premium relative to peers and sector, with lackluster earnings delivery and insider selling offsetting strong revenue momentum and balance sheet strength; the $192 target implies only modest upside, aligning with a neutral stance.
Key drivers: Revenue and earnings growth outperformance vs sector, Premium valuation constraining margin of safety, Insider selling and weak earnings surprise history
Confidence
65%
Value
48/100
RTX trades at a significant valuation premium to both sector averages and close peers like CAT and DE, despite lower ROE and profitability, suggesting limited margin of safety at current levels.
Positives
- Forward P/E of 28.73 is more reasonable than current P/E of 36.13, reflecting expected earnings acceleration
Watchpoints
- Current P/E of 36.13 is 35% above sector average of 26.79, increasing downside risk in a multiple contraction scenario
- Price/Book of 3.65 and Price/Sales of 2.74 are elevated for an industrial with single-digit profit margins
Future
70/100
With strong YoY and Q/Q earnings growth and positive price momentum (1Y +50.6%), RTX is benefiting from defense budget tailwinds, though valuation and sentiment risks cap near-term upside.
Positives
- Revenue growth of 11.90% and earnings growth of 29.40% YoY indicate strong execution and demand tailwinds in defense spending
- Q/Q earnings growth of 30.30% suggests accelerating profitability momentum
Watchpoints
- Lack of visibility into EV/EBITDA and free cash flow limits confidence in sustainable growth funding
- No analyst target range provided, reducing transparency on upside/downside dispersion
Past
58/100
While RTX has delivered strong long-term price appreciation and margin stability, its inability to beat earnings estimates recently and stagnant ROE undermine confidence in consistent outperformance.
Positives
- 5Y share price return of +185.7% demonstrates long-term value creation and sector leadership
- Consistent profitability with stable gross (20.13%) and operating margins (12.40%) over time
Watchpoints
- Zero earnings beats in last 4 quarters with 0.00% average surprise, indicating deteriorating execution or guidance sandbagging
- Historical ROE of 10.70% has not improved meaningfully, lagging sector trend toward higher returns
Health
72/100
RTX’s low leverage enhances financial resilience relative to highly leveraged peers like DE (2.67) and CAT (2.01), though liquidity metrics suggest working capital inefficiencies.
Positives
- Debt/Equity of 0.61 is well below sector average of 1.76, providing significant financial flexibility
- Current ratio of 1.07, while tight, is acceptable for a large-cap industrial with government contracts
Watchpoints
- Quick ratio of 0.67 indicates potential near-term liquidity pressure if receivables or inventory turn slowly
- Missing total cash, debt, and cash flow data limits full assessment of runway and operational resilience
Dividend
75/100
RTX offers a reliable dividend with solid coverage, appealing to income investors, though it lacks the growth or yield magnitude to be a core bullish driver.
Positives
- Dividend yield of 1.55% is competitive within the industrials sector and provides income stability
- Payout ratio of 53.80% is sustainable given earnings growth and cash flow generation
Watchpoints
- No data on 5-year yield average or dividend growth history limits assessment of policy consistency
- Dividend not a primary investment thesis given modest yield and lack of growth visibility
Stock Price & Analyst Targets
Real-time price movements and analyst price targets
Current Price
$175.57
Analyst Target
$192.06
Upside/Downside
+9.4%
Multi-Horizon Performance vs Peers
Price momentum across 5Y → 1W horizons for RTX and closest competitors.
Updated 2025-11-14
| Company | 5Y | 3Y | 1Y | 6M | 1M | 1W |
|---|---|---|---|---|---|---|
|
RTX
RTX Corporation
Primary
|
+185.7% | +96.5% | +50.6% | +30.8% | +11.8% | -0.8% |
|
CAT
Caterpillar Inc.
Peer
|
+251.8% | +148.6% | +45.2% | +57.7% | +4.0% | -1.6% |
|
GEV
GE Vernova Inc.
Peer
|
+341.7% | +341.7% | +77.8% | +35.2% | -6.1% | +0.6% |
|
GE
GE Aerospace
Peer
|
+553.6% | +470.0% | +71.9% | +31.9% | +1.6% | -0.8% |
|
BA
The Boeing Company
Peer
|
-3.9% | +10.9% | +40.8% | -5.5% | -9.1% | -0.1% |
Positive values indicate cumulative gains over the specified period. Comparables pulled from the same sector to highlight whether momentum is stock-specific or industry-wide.
Historical Performance Trends
Long-term financial metrics and growth patterns
Revenue & Net Income
Profit & Operating Margins
Return on Equity (ROE)
Quarterly Revenue Growth
Historical data shows last 12 quarters (3 years)
Valuation Metrics
Key valuation ratios and pricing indicators
P/E Ratio
36.13
Forward P/E
28.73
PEG Ratio
N/A
P/B Ratio
3.65
P/S Ratio
2.74
EV/Revenue
3.16
EV/EBITDA
18.81
Market Cap
$235.4B
Profitability
Profit margins and return metrics
Profit Margin
7.67%
Operating Margin
12.4%
Gross Margin
20.13%
ROE
10.7%
ROA
3.79%
Growth
Revenue and earnings growth rates
Revenue Growth
+11.9%
Earnings Growth
+29.4%
Q/Q Revenue Growth
N/A
Q/Q Earnings Growth
+30.3%
Financial Health
Balance sheet strength and liquidity metrics
Debt/Equity
0.61
Moderate
Current Ratio
1.07
Good
Quick Ratio
0.67
Poor
Cash/Share
$4.45
Quarterly Earnings History
EPS performance vs analyst estimates
2026-01-27
$N/A
2025-10-21
$1.7
+20.6% surprise
2025-07-22
$1.22
+11.2% surprise
2025-04-22
$1.47
+7.5% surprise
Industrials Sector Comparison
Comparing RTX against 28 companies in the Industrials sector
(6 bullish, 21 neutral, 1 bearish)
P/E Ratio
36.13
This Stock
vs
32.92
Sector Avg
+9.7%
(Premium)
Return on Equity (ROE)
10.7%
This Stock
vs
31.08%
Sector Avg
-65.6%
(Below Avg)
Profit Margin
7.67%
This Stock
vs
13.32%
Sector Avg
-42.5%
(Weaker)
Debt to Equity
0.61
This Stock
vs
1.21
Sector Avg
-49.5%
(Less Debt)
Revenue Growth
11.9%
This Stock
vs
6.01%
Sector Avg
+97.9%
(Fast Growth)
Current Ratio
1.07
This Stock
vs
1.82
Sector Avg
-41.2%
(Weaker)
Similar Companies
Peer comparison within the same industry
| Company | AI Rating | Market Cap | P/E | ROE | Profit Margin | Price | |
|---|---|---|---|---|---|---|---|
|
RTX
RTX Corporation
|
NEUTRAL | $235.4B | 36.13 | 10.7% | 7.7% | $175.57 | |
|
CAT
Caterpillar Inc.
|
NEUTRAL | $259.55B | 28.48 | 46.3% | 14.3% | $554.03 | |
|
GEV
GE Vernova Inc.
|
NEUTRAL | $156.91B | 94.34 | 16.7% | 4.5% | $578.31 | |
|
GE
GE Aerospace
|
NEUTRAL | $321.53B | 40.81 | 42.1% | 18.3% | $304.82 | |
|
BA
The Boeing Company
|
NEUTRAL | $147.9B | - | -% | -12.2% | $194.52 |
Recent Insider Trading
Insider buy and sell transactions from the last 6 months
| Date | Insider | Position | Transaction | Shares | Value |
|---|---|---|---|---|---|
| 2025-10-27 | CALIO CHRISTOPHER T | Chief Executive Officer | Sale | 4,813 | $858,278 |
| 2025-10-27 | CALIO CHRISTOPHER T | Chief Executive Officer | Option Exercise | 8,938 | $736,044 |
| 2025-10-24 | MITCHILL NEIL G JR | Chief Financial Officer | Sale | 4,849 | $873,528 |
| 2025-10-24 | ATKINSON TRACY A | Director | Sale | 2,800 | $500,948 |
| 2025-10-24 | MITCHILL NEIL G JR | Chief Financial Officer | Option Exercise | 8,938 | $736,044 |
| 2025-10-01 | BRUNK TROY D | Officer | Stock Award | 91 | - |
| 2025-10-01 | JOHNSON AMY L. | Officer | Stock Award | 268 | - |
| 2025-10-01 | DASILVA KEVIN G | Officer and Treasurer | Stock Award | 351 | - |
| 2025-08-27 | EDDY SHANE G | Officer | Sale | 25,968 | $4,149,390 |
| 2025-08-27 | EDDY SHANE G | Officer | Option Exercise | 49,808 | $3,805,919 |
| 2025-08-12 | BRUNK TROY D | Officer | Sale | 7,654 | $1,187,908 |
| 2025-08-12 | BRUNK TROY D | Officer | Option Exercise | 18,773 | $1,725,782 |
| 2025-08-04 | JASPER PHILIP J | Officer | Sale | 12,847 | $2,027,521 |
| 2025-08-04 | JASPER PHILIP J | Officer | Option Exercise | 23,500 | $1,683,070 |
| 2025-07-24 | DASILVA KEVIN G | Officer and Treasurer | Sale | 8,704 | $1,359,574 |
Insider transactions can signal confidence or concerns about company prospects
Wall Street Analysts
Professional analyst ratings and price targets
Consensus
BUY
18 analysts
B of A Securities
2025-10-27
Buy
Buy
UBS
2025-10-22
Buy
Buy
Susquehanna
2025-10-22
Positive
Positive
Goldman Sachs
2025-10-22
Neutral
Neutral
Bernstein
2025-10-06
Market Perform
Market Perform
Bernstein
2025-09-10
Market Perform
Market Perform
Barclays
2025-07-29
Equal-Weight
Equal-Weight
UBS
2025-07-23
Buy
Buy
JP Morgan
2025-07-23
Overweight
Overweight
RBC Capital
2025-07-23
Outperform
Outperform