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RTX Corporation (RTX) stock analysis

RTX holds near its 200-day average after a Q3 beat, with valuation and a 14% gap below the high in focus

RTX closed at 194.60 on Oct 27, 2026, 14.23% below its 52-week high of 226.88. The Oct 20 report beat EPS consensus by 26.97% and revenue by 3.55%, yet the shares moved -0.27% on the day. Forward P/E of 24.06× on next year's consensus EPS sits modestly above the industry median of 23.05×, while analysts' mean target is 226.50.

  • Price: 194.60
  • Market Cap (USD): $263.14B
  • P/E: 30.86×
  • Fwd P/E: 24.06×
  • Div Yield: 1.45%
  • 1Y Return: 8.93%
  • Mean Target: 226.50
  • Rating: Buy

Bull case

  • Q3 FY2026 EPS of 1.89 diluted compares with 1.41 a year earlier, and the Oct 20 report beat EPS consensus (1.78) by 26.97% with a 3.55% revenue beat.
  • Free cash flow over the trailing twelve months is $9.13B, up 86.65% year over year, with operating margin up 1.52% from a year ago to 11.77%.
  • Analysts' consensus is Buy (18 Buy, 8 Hold, 0 Sell as of Oct 28, 2026), with a mean target of 226.50, 16.39% above the current price.

Bear case

  • Forward P/E of 24.06× on next year's consensus EPS is 4.41% above the industry median, and the PEG ratio is 4.03×.
  • Expected EPS growth for next fiscal year is 5.97%, in the 7th percentile of US Industrials (sector median 13.27%), and ROIC of 9.02% is in the 24th percentile.
  • Deutsche Bank downgraded the stock from Buy to Hold on Oct 13, 2026, and RBC Capital and Bernstein cut targets on Oct 15 (to 235 and 214); the 3-month return is -9.59%.

What to watch

  • Next earnings date: Jan 26, 2027, with EPS consensus of 1.83.
  • The 200-day average at 195.26 and 50-day average at 196.06, both just above the 194.60 price.
  • The 20-day high of 198.19 and 20-day low of 179.02 as near-term range boundaries.
  • The 52-week high of 226.88 and 52-week low of 166.74.

General

RTX is a large aerospace and defense company with commercial, military and government customers. Results are growing at a double-digit pace and the latest quarter beat expectations, but the market reaction was muted. Valuation is slightly above the industry median, so growth durability matters.

The business

Per its profile, RTX serves commercial, military and governmental clients through Collins Aerospace, Pratt & Whitney, Raytheon Intelligence & Space and Raytheon Missiles & Defense. In fiscal 2025, Pratt and Whitney was 36.11% of product revenue, Collins 33.13% and Raytheon Intelligence & Space 30.76%. Domestic sales were 64.41% of the total.

Recent performance

Trailing revenue is $95.99B, up 11.63% year over year, and trailing EPS is 6.16, up 26.49%. Q3 FY2026 revenue was 24.96B against 22.48B a year earlier. Net margin is 8.88% and free cash flow margin 9.51%.

Valuation and sentiment

Trailing P/E is 30.86× and forward P/E 24.06× (next-year basis), in the 66th percentile of US Industrials against a median of 21.40×. Analysts rate it Buy, with a mean target of 226.50 from 14 analysts, although Deutsche Bank moved to Hold on Oct 13.

Long-term investor

Revenue has compounded at 9.38% over five years and profits have recovered from the 2020 loss. Returns on capital are below sector medians and the balance sheet carries meaningful debt. Dividends have grown for 29 years, while buybacks have been small recently.

Growth and margins

Annual revenue rose from 56.59B in fiscal 2020 to 88.60B in 2025, and diluted EPS from -2.59 to 4.96. Operating margin is 11.77%, in the 38th percentile of the sector (median 16.70%). Gross margin of 21.10% is in the 16th percentile.

Returns and balance sheet

ROIC is 9.02% and ROE 12.75%, versus sector medians of 12.73% and 18.66%. Net debt is 29.71B, or 1.77× EBITDA, interest coverage is 7.13× and debt to equity 0.56×. Goodwill of 52.97B is large against equity of 69.25B.

Capital return and ownership

Dividend yield is 1.45% with a 45.78% payout ratio and a quarterly payment of 0.73. Repurchases were 50.0M in fiscal 2025 against 12.87B in 2023. Institutions hold 80.98%, with the latest insider activity being sales, including a $3.1M sale on Aug 18, 2026.

Swing trader

Price is sandwiched between the 20-day average below and the 50-, 100- and 200-day averages above. Momentum is neutral to improving, and the trend is moderately strong. The recent range is 179.02 to 198.19.

Trend and momentum

At 194.60, price is 3.36% above the 20-day average (188.27), 0.74% below the 50-day (196.06) and 0.34% below the 200-day (195.26). RSI(14) is 54.27, MACD 0.2 is above its signal at -1.4, and ADX is 30.32. Relative strength rating is 55.

Recent sessions and levels

The stock fell 1.46% on Oct 27 on 4.4M shares, below the 10-day average of 6.1M, after reaching 198.19 intraday, the 20-day high. Earnings day Oct 20 saw 9.9M shares. Support sits near 188 to 191 from recent lows. ATR is 4.66, or 2.40% of price.

Flow and catalysts

Short interest is 13.8M shares, or 1.02% of float, as of Oct 15, 2026. Analyst actions were mixed: one downgrade in the last 30 days and no upgrades. The next earnings date is Jan 26, 2027, outside the near-term window.

Options

Implied volatility is moderate and a little above realized, with a flat term structure and little skew. Liquidity is good. No earnings event falls inside the 30-day expiry window.

Volatility level

30-day implied volatility is 26.38% with an IV rank of 32 and IV percentile of 35, versus a 52-week range of 20.11% to 39.45%. IV fell 6.2 points over 20 days. The 30-day IV/HV ratio is 1.12× against 20-day realized volatility of 26.09%, so premium is only slightly above realized.

Term structure and expected moves

IV is 26.26% at 60 days and 26.77% at 90 days, a flat curve, and the 25-delta skew is -0.6 points. The market implies a 3.65% move over 7 days (7.11) and 7.56% over 30 days (14.72).

Premium and liquidity

For the Nov 27, 2026 expiry (31 days), the 30-delta put at 185.00 pays 2.34, a 14.89% annualized yield, and the 30-delta call at 205.00 pays 2.73, 16.52% annualized. Options liquidity score is 86 and open interest is 209.1K. Today's volume was 0.59× its 20-day average.

Analysis written October 28, 2026 from Qanvo data as of October 27, 2026. AI-generated, for information only; not investment advice.