RTX Outperforms Industry in the Past Year: Should You Buy? - The Globe and Mail

RTX Corporation has demonstrated impressive performance with its stock surging 11% over the past year, significantly outperforming the Zacks Aerospace-Defense industry which declined by 15.3%. The company also surpassed the broader Zacks Aerospace sector's 12.5% decline and the S&P 500's 9.3% return in the same period.

Other industry players have shown mixed results, with General Dynamics shares gaining 5.1% and Embraer delivering stronger performance with a 29.5% increase in the past year. This comparative performance positions RTX favorably among its peers in the aerospace and defense sector.

Growth Drivers

RTX continues to strengthen its aerospace and defense operations through advancements in missile technology, next-generation defense capabilities, and expanded aftermarket services. In the third quarter of 2026, the company reported adjusted earnings per share of $2.26, up 32.9% year over year, while revenues increased 11.1% to $24.97 billion, both exceeding Zacks Consensus Estimates.

In November 2026, Raytheon successfully completed the third flight test of its DeepStrike JR3 solution for the U.S. Army's Joint Reduced Range Rocket program, demonstrating key performance attributes including range, accuracy, trajectory and launch pod reusability.

Meanwhile, Collins Aerospace received a boost when Air Europa extended its exclusive Boeing 787 nacelle maintenance agreement through 2037 in October, covering thrust reverser and nacelle services and expected to improve fleet reliability and reduce unscheduled downtime.

Financial Outlook

The Zacks Consensus Estimate for RTX's 2026 sales implies year-over-year growth of 8.8%, while earnings estimates indicate a 22.9% increase. The company's annual bottom-line estimates have moved north over the past 60 days, reflecting improving investor confidence.

In terms of valuation, RTX's forward 12-month price-to-sales ratio stands at 2.62X, a premium to the industry average of 2.18X, suggesting investors are paying more for the company's expected sales growth compared to its peers. General Dynamics trades at 1.70X and Embraer at 1.60X forward P/S.

Investment Considerations

RTX maintains adequate liquidity with a current ratio of 1.05, indicating sufficient capital to cover short-term debt obligations. General Dynamics and Embraer also maintain healthy current ratios at 1.43 and 1.44 respectively.

Despite trading at a premium valuation, RTX's improving earnings prospects and strong business momentum across defense technology and commercial aerospace aftermarket services support a positive investment outlook. The company currently holds a Zacks Rank #1 (Strong Buy), positioning it as an attractive consideration for investors seeking exposure to the aerospace and defense sector.