RTX Outperforms Industry in the Past Year: Should You Buy?

RTX Corporation RTX stock has risen 62.5% in the past year, outperforming both the Zacks Aerospace-Defense industry’s growth of 36.9% and the broader Zacks Aerospace sector’s gain of 40%. It also came above the S&P 500’s return of 25.2% in the same time frame.

Other industry players, such as Huntington Ingalls Industries HII and General Dynamics GD, have also delivered a similar stellar performance in the past year. Shares of HII and GD have risen 120.3% and 37%, respectively, in the said period.

RTX’s strong recent performance may attract investors looking to buy the stock. However, it is important to evaluate whether the company’s fundamentals are strong enough to sustain long-term growth or if the recent rally could prove short-lived. A closer look at RTX’s growth prospects and potential risks can help investors make a more informed decision.

Tailwinds for RTX

RTX’s recent share strength is supported by several business developments across its defense and aerospace operations.

In February 2026, RTX’s BBN Technologies secured a contract from the Defense Advanced Research Projects Agency (DARPA) under the X-ray Extreme range Non imaging Analysis program. The initiative aims to develop advanced X-ray tools capable of reconstructing the hidden geometry of man-made objects from distances approaching a kilometer. This technology is expected to improve situational awareness for military personnel, particularly in scenarios where direct access to an area is unsafe or restricted.

RTX also received a production contract through its Raytheon ELCAN optical systems business to supply a customized version of its Specter DR 1-4x weapon sight to the German Armed Forces. The system is tailored to Germany’s soldier modernization program and includes an integrated reflex sight designed to support both close-range and mid-range engagements.

The company also announced a $200 million investment to expand its operations in Columbus, GA. The expansion includes the installation of a new isothermal forging press that is expected to increase the production of key engine components by around 30%. The investment is intended to support growing demand across engine programs such as the GTF and F135.

These developments reflect steady demand for RTX’s advanced defense technologies and continued investment in aerospace manufacturing capabilities, supporting its long-term growth prospects.

Estimates for RTX’s 2026 Sales and Earnings

The Zacks Consensus Estimate for RTX’s 2026 sales implies year-over-year growth of 5.4%. The consensus estimate for its 2026 earnings indicates a year-over-year increase of 8.3%.

The upward revision in its 2026 earnings over the past 60 days suggests investors’ increasing confidence in this stock’s earnings generation capabilities.

RTX’s Valuation

In terms of valuation, RTX’s forward 12-month price-to-earnings (P/E) is 30.00X, a discount to the industry average of 33.28X. This suggests that investors will be paying a lower price than the company's expected earnings growth compared with its industry average.

Huntington and General Dynamics are trading at a discount in comparison with RTX. HII’s forward 12-month price-to-earnings is 24.24X, while GD’s forward 12-month price-to-earnings is 21.73X.

Liquidity Position of RTX

RTX has a current ratio of 1.03. The ratio, being more than one, indicates that RTX possesses sufficient capital to pay off its short-term debt obligations.

Risks to Note Before Choosing RTX

Executive orders issued by the United States in February 2025 introduced tariffs on imports, which prompted retaliatory actions from China, the European Union and Canada. These rising trade tensions could disrupt global business activity and may affect defense companies such as RTX, Huntington and General Dynamics, which have significant international exposure.

Final Call

RTX’s attractive valuation and improving earnings outlook suggest that the stock is reasonably valued and offers steady growth potential. However, ongoing global trade uncertainties could create near-term risks and affect its performance. Current investors may choose to hold the stock, while new investors may wait for more clarity before taking a position.

RTX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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

Zacks Investment Research