Here's Why RTX (RTX) Fell More Than Broader Market

RTX (RTX) ended the recent trading session at $207.73, demonstrating a -1.88% change from the preceding day's closing price. This move lagged the S&P 500's daily loss of 0.33%. At the same time, the Dow lost 0.7%, and the tech-heavy Nasdaq lost 0.12%.

Coming into today, shares of the an aerospace and defense company had lost 1.63% in the past month. In that same time, the Aerospace sector lost 6.28%, while the S&P 500 gained 3.87%.

The upcoming earnings release of RTX will be of great interest to investors. On that day, RTX is projected to report earnings of $1.75 per share, which would represent year-over-year growth of 2.94%. Simultaneously, our latest consensus estimate expects the revenue to be $23.84 billion, showing a 6.06% escalation compared to the year-ago quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $7.22 per share and a revenue of $96.06 billion, representing changes of +14.79% and +8.41%, respectively, from the prior year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for RTX. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.27% higher. As of now, RTX holds a Zacks Rank of #3 (Hold).

In terms of valuation, RTX is presently being traded at a Forward P/E ratio of 29.34. For comparison, its industry has an average Forward P/E of 22.48, which means RTX is trading at a premium to the group.

We can also see that RTX currently has a PEG ratio of 2.52. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Aerospace - Defense industry held an average PEG ratio of 1.6.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 150, which puts it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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