RTX (Raytheon) (RTX)
The desk's stance
On our research list, not on the slate.
What the company does
Missiles, air defense (Patriot), and jet engines (Pratt & Whitney) — the munitions maker the Ukraine and Middle East wars ran down stockpiles of.
In short: Engines avionics and defense systems. Category: Aerospace and Defense Prime. Sector: Industrials, Aerospace & Defense.
G-Street Value and Score
G-Street Value: $207.08, computed Oct 18, 2026 (confidence: high).
How we got there: 70% analyst leg $207.84 (5 analyst targets, credibility- and freshness-weighted, after 8% optimism discount) + 30% GainStreet factor value $205.32 (26.09× fwd EPS anchored to aerospace-defense multiples).
G-Street Score: 54 out of 100 (Weak).
- Top-line growth & guidance: 17 of 32
- Margin power: 0 of 15
- Revenue visibility & quality: 9 of 11
- Profitability & balance sheet: 17 of 24
- Capital allocation & governance: 5 of 6
- Valuation, sentiment & momentum: 6 of 12
Our current thesis
Updated Oct 11, 2026
The thesis
- Record $289B backlog provides multi-year revenue visibility across commercial aerospace and defense segments.
- Broad revenue growth of 14.5% comfortably outpaces prime peers LMT, GD, and NOC.
- Commercial aftermarket strength and Pratt & Whitney throughput support expanding free cash flow.
Risks
- Commands a 23.6x forward P/E, a steep premium versus LMT (15.6x) and GD (17.8x).
- Fixed-price contract cost adjustments and supply chain bottlenecks threaten 8.3% net profit margins.
- Potential easing of geopolitical tensions could soften urgency for international munitions restocking.
What we're watching
- Q3 2026 earnings release and updated FY2026 free cash flow guidance on October 20, 2026.
- Pratt & Whitney GTF powder metal remediation progress and commercial aftermarket margin conversion.
- Share price technical consolidation and defense against key support near the $185 level.
Latest
RTX shares have retreated 16.5% over the past two months to $185.97, stabilizing near technical support despite posting four consecutive earnings beats and raising FY2026 outlook targets. Fundamental tailwinds remain solid, anchored by a record $289 billion backlog, double-digit commercial aftermarket growth, and persistent missile replenishment demand. Still, a 23.6x forward P/E demands flawless production conversion to sustain its premium over prime peers LMT (15.6x) and GD (17.8x).
Key numbers
As of Oct 16, 2026: market cap $261.4B · revenue growth +14.5% year over year · gross margin 20.3% · net margin 8.3% · forward P/E 24.6 · next earnings Oct 20, 2026.
Analyst price targets
Published analyst targets we could trace to a named source.
- Bernstein, Market Perform: $223 target (September 2026). Source: benzinga.com
- TD Cowen, Buy: $225 target (October 2026). Source: marketbeat.com
- Morgan Stanley, Overweight: $240 target (July 2026). Source: marketbeat.com
- Susquehanna, Positive: $245 target (July 2026). Source: benzinga.com
- Goldman Sachs, Neutral: $206 target (July 2026). Source: tipranks.com
On the Gainz Lab maps
Who it does business with
- Howmet Aerospace supplies RTX (Raytheon) — Engine components (about $2.0B a year). Howmet blades and structures go into Pratt & Whitney engines.
- Lockheed Martin competes with RTX (Raytheon) — Missiles & air defense. The two missile giants split the replenishment supercycle.
- RTX (Raytheon) supplies Governments — Missiles & air defense (about $45.0B a year). About half of RTX revenue is defense; the rest is commercial aerospace engines and parts.