RTX (RTX) Wins Major UK Army Contract, Is The Stock Still Cheap?

RTX (RTX) is back in focus after its RaytheonUK business led the Omnia Training consortium to win a £2,000 million, 15 year British Army Collective Training Service contract, highlighting the company’s broader aerospace and defense exposure.

See our latest analysis for RTX.

RTX shares have been relatively steady despite a stream of contract wins and product updates, with a 6.67% 1 month share price return and a 1 year total shareholder return of 32.52% pointing to momentum that has built over a longer horizon.

If RTX’s mix of defense contracts and aerospace technology has your attention, this could be a good moment to broaden your watchlist and check out 34 power grid technology and infrastructure stocks

RTX appears to be a solid aerospace and defense platform, supported by fresh contracts and new technology. However, after a 32.52% 1-year total return and a recent move higher, how does the current price compare with its fundamentals?

Most Popular RTX Narrative: 9.2% Undervalued

RTX last closed at $195.89, while the most followed narrative pegs fair value closer to $216, framing the stock as modestly undervalued on modeled cash flows.

Robust and growing backlog, highlighted by a 1.86 quarter book to bill ratio, $236 billion backlog (up 15% year over year), and major new international contracts (e.g., EU, MENA, Asia Pacific) indicate RTX is well positioned to benefit from sustained increases in global defense spending and heightened geopolitical tensions, setting up strong visibility for future revenue growth.

Read the complete narrative.

Want to understand why this fair value sits above today’s price? The narrative leans heavily on consistent revenue expansion, firmer margins, and a richer future earnings multiple. The key is how those three ingredients are expected to work together over time.

Result: Fair Value of $215.73 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, RTX’s story can change quickly if jet engine reliability issues at Pratt & Whitney resurface or if defense budgets shift away from its large hardware programs.

Find out about the key risks to this RTX narrative.

Next Steps

Given the mix of optimism and concern around RTX, it makes sense to review the details yourself, weigh both sides, and act promptly based on your judgment by reviewing the 4 key rewards and 2 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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