Raytheon Stock Price Rally Is Backed By Fundamental Aspects

Raytheon Stock Price

Raytheon (NYSE: RTN) stock price soared to a new all-time high amid investor’s confidence in product innovation and strong backlog. RTN looks like a good play for long-term investors who like to get dividends along with a steady share price appreciation. The company offers a quarterly dividend of $0.94 per share. Its dividend yield stands around 1.7% despite massive share price gains in the past twelve months.

Raytheon stock price is trading close to $230 at present; RTN share price grew 42% in the last twelve months. RTN share price is trading around 19 times to earnings compared to the industry average of 25. The strong growth in financial numbers is offering support to valuations.

RTN Raytheon Company daily Stock Chart

Fundamentals are Supporting Raytheon Stock Price

The company’s future fundamentals are strong. This is because of its backlog and new contract wins. RTN recently received almost $3B in contracts from the U.S. Department of Defense. On the other hand, RTN has generated stronger than expected financial numbers for the third quarter. Its revenues jumped 9% year over year to $7.45B compared to the past year period.

In addition, the company has also been experiencing steady growth in margins. Its earnings per share from continuing operations grew 36% from the year-ago period.

Raytheon Stock Price Rally...

“Higher Q3 profit margins due to timing were helpful in the quarter and across the business units, the segment margins of 12.1% exceeded our expectations,” CFO Toby O’Brien said.

Its cash returns are safe. Indeed, its financial numbers are offering a room for more dividend increases in the coming days. It has increased dividends in the past 18 consecutive years.

Outlook is Robust

Raytheon Stock Price Rally...

The company expects to generate high single-digit growth in revenues and double-digit growth in earnings. For the full year, RTN anticipates earnings per share in the range of $11.70-$11.80, in line with analyst consensus. RTN expects a full-year revenue of $29.1B-$29.4B. Overall, Raytheon’s stock price is receiving support from several fundamental factors.

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    Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.


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