GE Aerospace vs. RTX: Which Aerospace & Defense Stock Should You Bet On?

GE Aerospace GE and RTX Corporation RTX are two prominent names operating in the aerospace and defense industry. As rivals, both companies are engaged in producing highly engineered aircraft components for commercial and military aircraft in the United States and internationally.

Both companies have been enjoying significant growth opportunities in the aerospace and defense space on account of the improving air traffic trend and the expansionary U.S. budgetary policy in the past couple of years. Let’s take a closer look at their fundamentals, growth prospects and challenges.

The Case for GE Aerospace

GE Aerospace is poised to gain from its growing installed base and higher utilization of engine platforms, supported by strength across commercial & defense sectors. Growing popularity for LEAP, GEnx & GE9X engines and services, supported by growth in air traffic, fleet renewal and expansion activities, is driving its Commercial Engines & Services business.

During 2025, the company secured more than 500 engine wins at the Dubai Airshow, including deals from flydubai for GEnx engines and Riyadh Air for LEAP-1A engines. It received an order from Cathay Pacific to power their latest Boeing 777-9 aircraft with GE9X engines.

Also, GE’s deal with Qatar Airways to supply more than 400 GE9X and GEnx engines represents the largest widebody engine deal in its history. The Commercial Engines & Services business’ revenues and orders jumped 24% and 35%, respectively, on a year-over-year basis in 2025.

Solid demand for the company’s propulsion & additive technologies, critical aircraft systems and aftermarket services in the defense sector is boosting the Defense & Propulsion Technologies business’ performance. During 2025, the company secured a $5 billion contract from the U.S. Air Force to supply F110 engines, parts and support services as part of a Foreign Military Sales (FMS) program. In 2025, the Defense & Propulsion Technologies business’ revenues increased 11% and orders grew 19% on a year-over-year basis.

GE Aerospace has been on track to invest more than $1 billion in its MRO facilities around the world over the next five years. This includes the acquisition of a dedicated LEAP test cell, which will unlock a major constraint in its shop visit output. This also includes expanding several MRO facilities, including Dallas, Malaysia and Selma and a new on-wing support site in Dubai.

It remains focused on rewarding its shareholders handsomely through dividends and share repurchases. In 2025, GE paid dividends of $1.45 billion, up 44.1% year over year, to its shareholders. In the same period, it bought back shares for $7.4 billion.

The Case for RTX Corp.

A steady growth in global commercial air traffic continues to drive RTX, supported by higher commercial OEM and aftermarket sales. In the fourth quarter, the company reported 11% organic year-over-year sales growth, fueled by double-digit gains in both segments. Collins Aerospace recorded an 3% rise in sales, aided by a 13% increase in commercial aftermarket demand, while Pratt & Whitney’s revenues grew 25%, backed by a 21% jump in aftermarket and a 28% increase in OEM sales.

With a wide range of combat-proven defense products, RTX continues to receive ample orders from the Pentagon and its foreign allies. The company won several notable defense awards during the fourth quarter, which resulted in solid bookings of $10.3 billion and a record backlog of $268 billion.

Among the most significant awards is a $1.7 billion contract to deliver four Patriot air and missile defense systems to Spain. The company also landed a $1.2 billion deal for the production of Tamir missiles. Based on such solid bookings and backlog count, RTX expects both domestic and international program growth to remain robust for its defense business in the quarters ahead.

RTX’s strong liquidity position also adds to its strength. Exiting 2025, its cash and cash equivalents totaled $7.44 billion, higher than its current debt of $3.62 billion. This reflects a solid solvency position for the stock, at least over the short term.

However, in recent years, RTX has experienced supply-chain disruptions that resulted in delays and increased costs, which, in turn, affected its performance. These disruptions were due to supply-chain constraints like components and parts shortages, along with macroeconomic headwinds, including inflation and labor market shortages. 

Also, its high debt profile poses a concern. It exited 2025 with a long-term debt of $34.29 billion, which remained well above the cash balance.

Price Performance

In the past year, GE Aerospace shares have increased 70.5%, while RTX stock has gained 60.9%.

The Zacks Consensus Estimate for GE & RTX

The Zacks Consensus Estimate for GE’s 2026 sales and earnings per share (EPS) implies year-over-year growth of 14% and 16.8%, respectively. EPS estimates for both 2026 and 2027 have increased over the past 60 days.

The Zacks Consensus Estimate for RTX’s 2026 sales and EPS implies year-over-year growth of 5.4% and 8.3%, respectively. Although the EPS estimates for 2026 have increased over the past 60 days, the same for 2027 have declined.

Valuation for GE & RTX

RTX is trading at a forward 12-month price-to-earnings ratio of 29.21X, above its median of 19.31X over the last three years. GE’s forward earnings multiple sits at 44.49X, higher than its median of 36.59X over the same time frame.

Conclusion

GE Aerospace’s strong momentum in commercial and defense aerospace markets, driven by solid build rates, wide-body aircraft demand and robust defense budget, bodes well for growth. Given the strength in most of its served markets, GE has built a sound liquidity position that supports its shareholder-friendly policies.

In contrast, RTX Corp’s strength in the commercial and defense aerospace markets has been diluted by the supply-chain disruptions. Also, RTX’s high debt profile remains concerning.

Given these factors, GE seems a better pick for investors than RTX currently. While GE sports a Zacks Rank #1 (Strong Buy), RTX currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank stocks here.

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

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