Will Wall Street Analysts Forecast an Uptrend or Downtrend for RTX Corporation's Shares?
Rewritten Article:
Hike up, Arlington, Virginia-based RTX Corporation (RTX) – a jaw-dropping $170.2 billion aerospace and defense powerhouse – has left the broader market gasping in its tracks over the last 52 weeks. With a staggering 25.9% surge, the company has effortlessly outpaced the S&P 500 Index's humble 11.7% rally. And if that's not enough, RTX shares have soared an impressive 10.1% year-to-date (YTD), showing the SPX's 4.7% decline who's boss.
Let's dig a little deeper into this pre-IPO powerhouse.Focusing on the finer details, RTX has effortlessly beaten the Industrial Select Sector SPDR Fund's 9.1% return over the past 52 weeks and marginally outperformed its YTD growth.
Despite smashing expectations with Q1 2025 adjusted EPS of $1.47 and a whopping $20.3 billion in revenue, RTX shares dropped a sharp 9.8% on Apr. 22. Why, you ask? Management blinked, warning that the full-year outlook of $6 - $6.15 in adjusted EPS and $7 billion - $7.5 billion in free cash flow fails to account for the impact of freshly minted U.S. and non-U.S. tariffs. You do the math – these tariffs could choke RTX's adjusted operating profit by an estimated $850 million, even with planned mitigation efforts. Delays in receiving duty refunds could further strain the company's cash flow.
Peeling back the curtain for fiscal year 2025 ending in December 2025, analysts expect RTX's EPS to swell a modest 5.4% year-over-year to $6.04. With an impressive track record of toppling consensus estimates in the last four quarters, the company's earnings surprise history is nothing short of promising.
Twenty-three analysts monitor the stock, dishing out a "Moderate Buy" consensus rating. That's built on 14 hearty "Strong Buy" recommendations, one "Moderate Buy," and the timid eight "Holds." Compared to three months back, things look more positive, with 10 "Strong Buy" ratings now attached to the stock.
On Apr. 23, UBS analyst Gavin Parsons revved up RTX Corporation's price target to an aggressive $138, while reaffirming the stock's "Buy" rating. Currently, RTX is fetching lower than the mean price target of $140.74. The Street high price target of $160 suggests a tantalizing 25.6% upside potential.
Note: As of writing, Sohini Mondal doesn't have any positions in the aforementioned securities, and all information provided is intended solely for informational purposes. To delve deeper into our disclosure policy, click here.
Insights:RTX Corporation's Q1 2025 performance showed a promising start to the year, marred by looming uncertainty over potential tariff impacts:- Financial Results: $20.3 billion in sales, up 5% year-over-year, with organic growth spiking 8%. The adjusted EPS hovered at $1.47, a 10% YoY increase, surpassing Zacks Consensus estimates by 8.9%.- Operational Highlights: Reported $1.3 billion in operating cash flow and $0.9 billion in returned capital to shareholders. Backlog maintains a robust $217 billion, with commercial and defense segments accounting for $125 billion and $92 billion, respectively.- Segment Performance: Pratt & Whitney and Collins Aerospace drove sales growth, propelling the adjusted operating profit to $2.66 billion.- Outlook: Projected adjusted sales of $83.0-$84.0 billion; adjusted EPS of $6.00-$6.15; and free cash flow of $7.0-$7.5 billion. Anticipated organic sales growth of 4-6%, capitalizing on Q1's momentum.- Tariff Impacts: The outlook excludes potential tariff repercussions, as management prepares to discuss them in greater detail during earnings discussions.
- In 2025, RTX Corporation's shares could experience a significant upside potential, with analysts' consensus target suggesting a potential increase of 25.6%.
- Despite surpassing estimates in Q1 2025 with a $1.47 adjusted EPS and $20.3 billion in revenue, RTX shares dropped 9.8% due to concerns about the impact of fresh tariffs on their adjusted operating profit.
- In the past 52 weeks, RTX shares have outperformed both the S&P 500 Index and the Industrial Select Sector SPDR Fund, demonstrating a strong performance in the finance industry and leaving other companies in Virginia and the aerospace and defense sector in its tracks.
