10 Best Defense Stocks To Buy Now

03. RTX Corporation (NYSE:RTX)

Number of Hedge Fund Holders: 54

RTX Corporation (NYSE:RTX) stands out as a leading defense stock due to its diverse and robust portfolio in aerospace and defense systems, which serves a broad range of commercial, military, and government clients. The company operates through four main segments: Collins Aerospace Systems, Pratt & Whitney, Raytheon Intelligence and Space (RIS), and Raytheon Missiles and Defense (RMD). Each segment brings critical capabilities to the defense sector, from avionics and aircraft engines to advanced radar systems and missile defense solutions. This makes Raytheon a compelling choice for investors seeking exposure to the defense industry.

In the second quarter of 2024, RTX Corporation (NYSE:RTX) reported impressive financial results that underscore its strong market position and operational efficiency. The company achieved adjusted sales of $19.8 billion, reflecting a 10% organic growth. This growth was driven by significant contributions from all three major business segments and is indicative of robust demand across its product lines. The adjusted EPS of $1.41 surpassed analysts’ expectations of $1.30, marking a 9% increase year-over-year, driven by profit growth and improved margins.

RTX Corporation (NYSE:RTX) financial metrics highlight its operational strength. The company generated $2.2 billion in free cash flow, reinforcing its solid financial health and ability to return value to shareholders. The backlog continued to grow, reaching $206 billion with a book-to-bill ratio of 1.25, signaling strong future revenue visibility. Noteworthy contract wins include a multibillion-dollar award for the U.S. Air Force’s next-generation airborne operations center and a significant contract for SPY-6 radar production for the U.S. Navy, further emphasizing Raytheon’s pivotal role in defense technology.

The company has also demonstrated strategic foresight with substantial investments in innovation and capacity expansion. Raytheon is advancing in areas such as hybrid electric propulsion, next-generation sensing, and hypersonics, with a commitment of over $7.5 billion to research and development this year. This focus on future technologies not only supports ongoing growth but also positions Raytheon to capitalize on evolving defense needs. Overall, RTX Corporation (NYSE:RTX) offers a compelling investment case within the defense sector. Its strong financial performance, substantial backlog, and strategic investments in cutting-edge technologies reflect a well-positioned company poised for continued growth and value creation in the defense industry.