When RTX (RTX) posted quarterly results, the stock irrationally fell below $115. Buyers stepped in throughout last week, and the stock closed at $125.22. Although the downtrend on the chart is still bearish, investors should add RTX stock to the buy list.
RTX is among the defense and aerospace leaders that thrive as the war in Europe continues. In the first quarter, it earned $1.47 a share (non-GAAP). Revenue increased by 5.2% Y/Y to $20.3 billion. For 2025, the firm is forecasting adjusted sales of up to $84 billion, close to analyst estimates.
The European Union is ramping up its military spending. It seeks to prepare for potential conflicts through prevention. For example, Poland is increasing its spending to 5%, while the U.K. is considering it and Germany is already committed to it. Raytheon has an opportunity to sell integrated air and missile defense systems. Its battle-tested products include Patriot GEM-T, NASAMS, and Coyote.
Opportunity
The trade war adds costs for RTX. The firm has $850 million in costs to manage. This includes mitigations in regulatory, duties, and operational costs. RTX management is not concerned, since it operated effectively in a previously highly inflationary environment.
Your Takeaway
RTX is ready to manage supply chain disruptions related to tariffs. Investors are confident that the tariff trade war will not hurt RTX’s profits much.
