We recently published a list of the 10 Best Robotics Stocks to Buy According to Billionaires. In this article, we are going to take a look at where RTX Corporation (NYSE:RTX) stands against the other robotics stocks held by billionaires.
Robotics Market Outlook
The robotics industry has grown modestly over the past few years. Robotic companies are growing faster than ever, driven by advancements in technology since the emergence of AI. Especially, humanoid robots are rapidly growing in the global market, driven by AI. According to Goldman Sachs’ research, the total addressable market for humanoid robots is projected to cross $38 billion by 2035, a massive upgrade from its previous forecast of $6 billion in 2023.
READ ALSO: 10 Cheap Robotics Stocks To Invest In Now
Morgan Stanley expects the humanoid robot units to reach 40,000 by 2030 and cross 63 million by 2050. Citigroup is even more bullish, anticipating a $7 trillion humanoid robot market by 2050, with 1.19 billion humanoid robots in operation. Adam Jonas from Morgan Stanley expects humanoid robots to be a multi-decade, trillion-dollar opportunity as the adoption could accelerate faster for autonomous vehicles.
In 2023, the new World Robotics report noted around 4.28 million units operating in factories globally, growing by 10% compared to 2022. Annual installations surpassed half a million units for the third consecutive year. Asia remains the hot region for robots, with 70% of all newly deployed robots in 2023 installed in Asia. China, Japan, South Korea, and India are some of the largest robotics markets in the world. China leads the market, recording 276,288 industrial robots installed in 2023, representing 51% of the global installations. The U.S. has the largest robotics market in the region, accounting for 68% of installations in the Americas in 2023.
The U.S. stock market has been under pressure due to tariffs as the broader market has plunged over 4.50% year-to-date. At the same time, Global X Robotics & Artificial Intelligence ETF (BOTZ) and Robo Global Robotics and Automation Index ETF (ROBO), which returned over 11% in 2024, have dropped nearly 10% and 7% year-to-date, respectively. Despite the market facing political headwinds, robotics stocks hold great promise, considering the rising demand for humanoids and automation systems.
Pixabay/Public Domain
Our Methodology
To compile our list of the best robotics stocks to buy according to billionaires, we looked for the robotics and automation companies widely held by billionaires. Data for the billionaire holders for each stock was taken from Insider Monkey’s database, updated as of Q4 2024. Finally, the 10 best robotics stocks to buy were ranked in ascending order based on the billionaire investors holding stakes in them. We have also mentioned the number of hedge funds holding each stock as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
RTX Corporation (NYSE:RTX)
No. of Billionaire Investors: 17
No. of Hedge Fund Holders: 80
RTX Corporation (NYSE:RTX) is a leading aerospace and defense company that offers drone-based missile systems and counter-drone technologies. Its flagship military robot, Coyote, is a drone used to track and shoot down enemy UAVs. The company provides different advanced systems and services for commercial, military, and government customers globally. RTX operates its services and products through three businesses, including Collins Aerospace, Pratt & Whitney, and Raytheon. RTX remains a key player in the military drone market and also remains a major manufacturer of radars, sensors, and electronic warfare equipment.
On March 19, Baird analyst Peter Arment upgraded the rating on RTX shares from Neutral to Outperform, raising the price target from $136 to $160. The analyst believes that the multi-year Department of Defense replenishment cycle and rising European defense orders amid NATO rearmament will play a positive role in RTX’s growth. President Trump’s call for NATO members to increase defense spending to 5% of GDP from around 2% and the European Union’s proposed €800 billion ReArm Europe plan are considered to be catalysts for RTX going forward.
Longleaf Partners Fund stated the following regarding RTX Corporation (NYSE:RTX) in its Q4 2024 investor letter:
“RTX Corporation (NYSE:RTX) – Aerospace and defense company RTX was a top contributor for the year. Our appraisal value has grown nicely since we first purchased the company just over a year ago. While the issues for Pratt & Whitney’s (P&W) Geared Turbofan engine are still not yet fully fixed, they have gotten better and given us another reminder that the point of maximum pessimism is only obvious in retrospect. We continue to have a conservative valuation on P&W so view this as a source of future value upside. The Raytheon segment has also performed better as the year has gone on, with recent signs of margin improvement. Strong industry tailwinds, prudent capital allocation, and a solid balance sheet provide a foundation for sustained growth and eventual full value recognition.”
Overall RTX ranks 3rd on our list of the Robotics stocks to buy according to billionaires. While we acknowledge the potential of RTX as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RTX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks To Invest In According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
