RTX CORP (RTX) Stock Fundamental Analysis
NYSE:RTX - New York Stock Exchange, Inc. - US75513E1010 - Common Stock - Currency: USD
RTX gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 65 industry peers in the Aerospace & Defense industry. While RTX is still in line with the averages on profitability rating, there are concerns on its financial health. RTX is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
RTX had positive earnings in the past year.
RTX had a positive operating cash flow in the past year.
RTX had positive earnings in 4 of the past 5 years.
RTX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
RTX has a Return On Assets (2.79%) which is comparable to the rest of the industry.
RTX has a Return On Equity (7.48%) which is comparable to the rest of the industry.
With a Return On Invested Capital value of 4.66%, RTX perfoms like the industry average, outperforming 44.62% of the companies in the same industry.
RTX had an Average Return On Invested Capital over the past 3 years of 3.68%. This is below the industry average of 8.39%.
The last Return On Invested Capital (4.66%) for RTX is above the 3 year average (3.68%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.79% | ||
| ROE | 7.48% | ||
| ROIC | 4.66% |
ROA(3y)2.73%
ROA(5y)1.68%
ROE(3y)6.81%
ROE(5y)4.17%
ROIC(3y)3.68%
ROIC(5y)3.17%
1.3 Margins
With a Profit Margin value of 5.63%, RTX perfoms like the industry average, outperforming 56.92% of the companies in the same industry.
RTX's Profit Margin has declined in the last couple of years.
RTX has a Operating Margin of 7.59%. This is comparable to the rest of the industry: RTX outperforms 50.77% of its industry peers.
In the last couple of years the Operating Margin of RTX has declined.
With a Gross Margin value of 19.53%, RTX is not doing good in the industry: 66.15% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of RTX has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.59% | ||
| PM (TTM) | 5.63% | ||
| GM | 19.53% |
OM growth 3Y-2.13%
OM growth 5Y-7.15%
PM growth 3Y-0.49%
PM growth 5Y-13.5%
GM growth 3Y-0.54%
GM growth 5Y-4.24%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RTX is destroying value.
The number of shares outstanding for RTX has been increased compared to 1 year ago.
Compared to 5 years ago, RTX has more shares outstanding
Compared to 1 year ago, RTX has an improved debt to assets ratio.
2.2 Solvency
RTX has an Altman-Z score of 2.16. This is not the best score and indicates that RTX is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.16, RTX is not doing good in the industry: 66.15% of the companies in the same industry are doing better.
RTX has a debt to FCF ratio of 8.43. This is a slightly negative value and a sign of low solvency as RTX would need 8.43 years to pay back of all of its debts.
RTX has a Debt to FCF ratio (8.43) which is in line with its industry peers.
A Debt/Equity ratio of 0.63 indicates that RTX is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.63, RTX is in line with its industry, outperforming 43.08% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 8.43 | ||
| Altman-Z | 2.16 |
ROIC/WACC0.46
WACC10.08%
2.3 Liquidity
RTX has a Current Ratio of 1.01. This is a normal value and indicates that RTX is financially healthy and should not expect problems in meeting its short term obligations.
RTX has a Current ratio of 1.01. This is amonst the worse of the industry: RTX underperforms 89.23% of its industry peers.
RTX has a Quick Ratio of 1.01. This is a bad value and indicates that RTX is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.75, RTX is not doing good in the industry: 81.54% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.01 | ||
| Quick Ratio | 0.75 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.54% over the past year.
RTX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.02% yearly.
Looking at the last year, RTX shows a quite strong growth in Revenue. The Revenue has grown by 15.11% in the last year.
The Revenue has been growing by 12.23% on average over the past years. This is quite good.
EPS 1Y (TTM)13.54%
EPS 3Y10.36%
EPS 5Y-7.02%
EPS Q2Q%9.7%
Revenue 1Y (TTM)15.11%
Revenue growth 3Y7.83%
Revenue growth 5Y12.23%
Sales Q2Q%5.19%
3.2 Future
The Earnings Per Share is expected to grow by 7.26% on average over the next years.
The Revenue is expected to grow by 4.45% on average over the next years.
EPS Next Y4.99%
EPS Next 2Y8.53%
EPS Next 3Y9.32%
EPS Next 5Y7.26%
Revenue Next Year5.63%
Revenue Next 2Y5.7%
Revenue Next 3Y5.8%
Revenue Next 5Y4.45%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.02, which indicates a rather expensive current valuation of RTX.
Based on the Price/Earnings ratio, RTX is valued a bit cheaper than 76.92% of the companies in the same industry.
When comparing the Price/Earnings ratio of RTX to the average of the S&P500 Index (26.53), we can say RTX is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 20.85, the valuation of RTX can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of RTX indicates a somewhat cheap valuation: RTX is cheaper than 73.85% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.27. RTX is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.02 | ||
| Fwd PE | 20.85 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RTX is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
75.38% of the companies in the same industry are more expensive than RTX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.45 | ||
| EV/EBITDA | 21 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates RTX does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)4.81
PEG (5Y)N/A
EPS Next 2Y8.53%
EPS Next 3Y9.32%
5. Dividend
5.1 Amount
RTX has a Yearly Dividend Yield of 1.96%. Purely for dividend investing, there may be better candidates out there.
RTX's Dividend Yield is rather good when compared to the industry average which is at 1.29. RTX pays more dividend than 90.77% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, RTX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
5.2 History
The dividend of RTX decreases each year by -3.09%.
RTX has paid a dividend for at least 10 years, which is a reliable track record.
RTX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-3.09%
Div Incr Years31
Div Non Decr Years34
5.3 Sustainability
RTX pays out 71.48% of its income as dividend. This is not a sustainable payout ratio.
DP71.48%
EPS Next 2Y8.53%
EPS Next 3Y9.32%
140.98
+1.88 (+1.35%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners81.8%
Inst Owner Change1.67%
Ins Owners0.03%
Ins Owner Change-0.04%
Market Cap188.34B
Analysts77.33
Price Target138.46 (-1.79%)
Short Float %0.88%
Short Ratio2.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
Yearly Dividend2.42
Dividend Growth(5Y)-3.09%
DP71.48%
Div Incr Years31
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.06%
Min EPS beat(2)7.43%
Max EPS beat(2)10.7%
EPS beat(4)4
Avg EPS beat(4)8.24%
Min EPS beat(4)7.07%
Max EPS beat(4)10.7%
EPS beat(8)8
Avg EPS beat(8)6.76%
EPS beat(12)12
Avg EPS beat(12)5.85%
EPS beat(16)16
Avg EPS beat(16)6.97%
Revenue beat(2)2
Avg Revenue beat(2)2.9%
Min Revenue beat(2)1.58%
Max Revenue beat(2)4.23%
Revenue beat(4)4
Avg Revenue beat(4)1.92%
Min Revenue beat(4)0.21%
Max Revenue beat(4)4.23%
Revenue beat(8)7
Avg Revenue beat(8)1.82%
Revenue beat(12)8
Avg Revenue beat(12)0.7%
Revenue beat(16)8
Avg Revenue beat(16)0.12%
PT rev (1m)1.08%
PT rev (3m)-2.71%
EPS NQ rev (1m)0.45%
EPS NQ rev (3m)-3.02%
EPS NY rev (1m)-2.17%
EPS NY rev (3m)-2.68%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-0.31%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.05%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.02 | ||
| Fwd PE | 20.85 | ||
| P/S | 2.3 | ||
| P/FCF | 38.45 | ||
| P/OCF | 23.19 | ||
| P/B | 3.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21 |
EPS(TTM)5.87
EY4.16%
EPS(NY)6.76
Fwd EY4.8%
FCF(TTM)3.67
FCFY2.6%
OCF(TTM)6.08
OCFY4.31%
SpS61.18
BVpS46.05
TBVpS-18.45
PEG (NY)4.81
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.79% | ||
| ROE | 7.48% | ||
| ROCE | 5.53% | ||
| ROIC | 4.66% | ||
| ROICexc | 4.89% | ||
| ROICexgc | 24.81% | ||
| OM | 7.59% | ||
| PM (TTM) | 5.63% | ||
| GM | 19.53% | ||
| FCFM | 5.99% |
ROA(3y)2.73%
ROA(5y)1.68%
ROE(3y)6.81%
ROE(5y)4.17%
ROIC(3y)3.68%
ROIC(5y)3.17%
ROICexc(3y)3.89%
ROICexc(5y)3.36%
ROICexgc(3y)20.34%
ROICexgc(5y)17.15%
ROCE(3y)4.37%
ROCE(5y)3.76%
ROICexcg growth 3Y14.66%
ROICexcg growth 5Y12.77%
ROICexc growth 3Y9.47%
ROICexc growth 5Y0.94%
OM growth 3Y-2.13%
OM growth 5Y-7.15%
PM growth 3Y-0.49%
PM growth 5Y-13.5%
GM growth 3Y-0.54%
GM growth 5Y-4.24%
F-Score8
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 8.43 | ||
| Debt/EBITDA | 3.64 | ||
| Cap/Depr | 73.97% | ||
| Cap/Sales | 3.94% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.91% | ||
| Profit Quality | 106.5% | ||
| Current Ratio | 1.01 | ||
| Quick Ratio | 0.75 | ||
| Altman-Z | 2.16 |
F-Score8
WACC10.08%
ROIC/WACC0.46
Cap/Depr(3y)72.3%
Cap/Depr(5y)63.03%
Cap/Sales(3y)4.25%
Cap/Sales(5y)3.96%
Profit Quality(3y)104.78%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)13.54%
EPS 3Y10.36%
EPS 5Y-7.02%
EPS Q2Q%9.7%
EPS Next Y4.99%
EPS Next 2Y8.53%
EPS Next 3Y9.32%
EPS Next 5Y7.26%
Revenue 1Y (TTM)15.11%
Revenue growth 3Y7.83%
Revenue growth 5Y12.23%
Sales Q2Q%5.19%
Revenue Next Year5.63%
Revenue Next 2Y5.7%
Revenue Next 3Y5.8%
Revenue Next 5Y4.45%
EBIT growth 1Y67.24%
EBIT growth 3Y5.54%
EBIT growth 5Y4.21%
EBIT Next Year37.99%
EBIT Next 3Y18.06%
EBIT Next 5Y10.74%
FCF growth 1Y70.76%
FCF growth 3Y-6.17%
FCF growth 5Y-10.06%
OCF growth 1Y39.34%
OCF growth 3Y0.41%
OCF growth 5Y-4.22%