War is good business, at least by some reckoning. That certainly seems to be the case for defense company RTX (NYSE:RTX), whose Raytheon unit landed a major new contract earlier today. Despite this, investors aren’t particularly pleased with the deal and sent shares down fractionally in Thursday afternoon’s trading.
Raytheon brought in a whopping $1.2 billion to offer up Patriot missile defense systems to Germany. The package purchased includes a range of supporting options, including missiles, radar systems, and launchers. Command and control operations, as well as support and spares, are also included in the package Germany purchased. As noted by Raytheon’s president of land and air defense systems, Tom Laliberty, the decision to acquire Patriot missile systems represents a growing worldwide emphasis on improving defensive capabilities, particularly regarding missiles and air attacks.
Not All Good News
The Space Development Agency (SDA) in the United States has reconsidered plans to pick up seven satellites from Raytheon as part of its operations. The entire contract, reports note, is being “re-evaluated,” and from the sounds of it so far, it’s being “re-evaluated” away from Raytheon. That means, potentially, a $250 million line of business will be reduced or possibly done away with altogether. It’s unclear why the re-evaluation is kicking in, but it’s not providing much help for RTX’s share price.
What Is the Stock Price Target for RTX?
Turning to Wall Street, analysts have a Hold consensus rating on RTX stock based on four Buys, seven Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 0.06% increase in its share price over the past year, the average RTX price target of $95.42 per share implies 1.05% upside potential.
