Raytheon: Travel Recovery Offsets Q4 Bad News In Defense And Tax

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Librarian Capital


  • RTX has gained another 3.5% since Q4 results on Tuesday, but still has a reasonable 20.7x P/E and 2.2% Dividend Yield.
  • Its aerospace segments continued a strong EBIT rebound, driven by the ongoing recovery in global air travel, which will also help 2023.
  • Its defense segments are suffering from both supply chain issues and execution problems; RTX is merging them to improve things.
  • The main bad news is the impact from new tax rules around R&D costs, which will reduce cashflows temporarily, including by $1bn in 2025.
  • With shares at $99.60, we expect an exit price of $133 and a total return of 44% (13.7% annualized) by 2025 year-end. Buy.

Airbus A320

sansara/iStock via Getty Images


Raytheon Technologies Corporation (NYSE:RTX) reported Q4 2022 results on Tuesday (January 25) morning. RTX shares have since risen by 3.5%, and are up 10.3% in the past year:

Raytheon Share Price (Last 1

This article was written by

Librarian Capital profile picture
Global, long-term, fundamentally-oriented & concentrated investing. With more than 10 years' buy-side experience, I look at stocks globally and across industries, with a focus on the U.S. and U.K.. My investing style can best be described as "Quality Growth" or "Growth At a Reasonable Price". (previously writing under the name "Blue Sky Capital" until December 2019)

Disclosure: I/we have a beneficial long position in the shares of RTX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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