RTX's Raytheon Unit Set to See Sales Boost With Major Defense Contracts

RTX Corporation (RTX), a prominent defense contractor, plays a key role in a wide array of defense operations, with its Raytheon business segment offering a variety of weapons, including air, sea and land-based missiles, interceptors, command and control mission solutions, radars, cyber solutions and a few more.

Thanks to RTX’s experience of delivering cutting-edge products to the defense market, its Raytheon unit enjoys a solid inflow of contracts for its combat-proven products like AIM-9X, AMRAAM and Standard Missile-6 (SM-6) as well as Global Patriot Solutions. This, in turn, bolsters this unit’s revenue growth. The Raytheon unit reported a year-over-year increase of 1.4% in sales in 2024 and 4.7% in 2023.

The unit’s recently secured multi-million-dollar defense contracts should continue to boost its top-line performance in the days ahead. In June 2025, RTX won a $1.10 billion contract modification for the production and delivery of AIM-9X Lot 25 missiles. In the same month, RTX was awarded a $250 million contract from Japan's Mitsubishi Electric Corporation (“MELCO”) for ESSM Block 2 licensed production. Earlier, in May, RTX secured a $1 billion contract to supply up to 55 Standard Missile-3 (SM-3) missiles.

Other Defense Contractors Riding on Solid Contract Flows

As nations worldwide race to modernize their defense systems, prominent U.S.-based defense contractors like Northrop Grumman (NOC) and Lockheed Martin Corporation (LMT) are also securing more and more contracts for their combat-proven products, thereby ensuring a steady revenue stream for themselves.

In June, the Swedish Defence Materiel Administration selected Lockheed Martin’s TPY-4 next-generation ground-based air surveillance radar to enhance the country’s long-range surveillance capabilities, making Sweden the third nation to adopt this advanced fifth-generation radar system. Additionally, the company was awarded a $250 million contract to produce the F-35 logistics information system, which includes the Autonomic Logistics Information System and Operational Data Integrated Network and Mission Planning Environment hardware.

On the other hand, Northrop clinched a $267.2 million contract in March to manufacture and deliver two MQ-4C Triton unmanned air systems and provide the U.S. Navy with a main operating base, along with associated support, related technical and administrative data services. The company clinched a $481.3 million contract in January for providing updates and improvements to the Integrated Air and Missile Defense Battle Command System's software.

The Zacks Rundown for RTX

Shares of RTX have gained 45.3% in the past year compared with the industry’s 19% growth.

The company shares are trading at a discount on a relative basis, with its forward 12-month Price/Earnings being 22.95X compared with its industry’s average of 26.70X.

The Zacks Consensus Estimate for RTX’s 2025 and 2026 earnings has moved south over the past 60 days. The same for the second and the quarters of 2025 has also gone south.

RTX stock currently carries a Zacks Rank #4 (Sell).

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).

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