What to expect from RTX’s Q2 2024 earnings report

RTX Corporation (RTX) is an aerospace and defense company based in Arlington, Virginia. The company, valued at $133.08 billion at market capitalization, offers avionics systems, flight systems, communications and navigation equipment, aircraft interior and exterior lighting, aircraft seats, environmental control systems, flight control systems, and engine components. RTX serves its customers through three of its businesses: Collins Aerospace, Pratt & Whitney, and Raytheon. The major defense manufacturer is expected to report its fiscal second quarter 2024 financial results before the market opens on Thursday, July 25.

Ahead of the event, analysts expect RTX to post earnings of $1.29 per share on a diluted basis, unchanged from the year-ago quarter. The company has consistently topped Wall Street earnings per share estimates in its last four quarterly reports. In the previous quarter, RTX received a $1.2 billion contract to supply Germany with additional Patriot air and missile defense systems.

For fiscal 2024, analysts forecast RTX will post earnings per share of $5.39, up 6.5% from earnings per share of $5.06 in fiscal 2023.

RTX stock has outperformed the S&P 500 ($SPX)’s gain of 16.9% YTD, with the stock up 20.2% in the period. It similarly outperformed the S&P 500 Industrial Sector SPDR (XLI)’s gain of 6% in the same time frame.

RTX’s overall performance can be attributed to its solid first-quarter results and solid 2024 guidance. The company’s sales rose 12% year over year to $19.3 billion, and its adjusted earnings per share increased 10% from the previous quarter to $1.34. In 2024, RTX believes its margins will improve and expects total sales to increase by 14%, with adjusted earnings per share in the range of $5.25 to $5.40. The company has a record backlog of over $202 billion. Meanwhile, it lowered its 2025 free cash flow target from $9 billion to $7.5 billion as part of an ongoing inspection to check for potentially defective components in its GTF jet engines.

Analysts are unanimously bullish on RTX stock, with an overall rating of “Moderate Buy.” Of the 21 analysts covering the stock, six recommend a “Strong Buy” rating, 14 have a “Hold” rating, and one recommends a “Strong Sell.” The average analyst price target for RTX is $101.68, indicating marginal potential upside from current levels.

On the date of publication, Dipanjan Banchur did not hold (directly or indirectly) a position in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. For more information, please refer to Barchart’s Disclosure Policy here.