NYSE:RTN

Stock Analysis Report

Executive Summary

Raytheon Company develops integrated products, services, and solutions for the defense and other government markets worldwide.


Snowflake Analysis

Outstanding track record with flawless balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Raytheon's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RTN's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-17.6%

RTN

-5.7%

US Aerospace & Defense

2.4%

US Market


1 Year Return

-34.9%

RTN

-16.9%

US Aerospace & Defense

-10.0%

US Market

Return vs Industry: RTN underperformed the US Aerospace & Defense industry which returned -23.1% over the past year.

Return vs Market: RTN underperformed the US Market which returned -15.1% over the past year.


Shareholder returns

RTNIndustryMarket
7 Day-17.6%-5.7%2.4%
30 Day-36.6%-22.7%-11.0%
90 Day-48.7%-32.4%-19.4%
1 Year-33.6%-34.9%-5.8%-16.9%-8.1%-10.0%
3 Year-19.1%-23.5%12.2%-4.5%17.3%9.6%
5 Year17.2%6.4%48.0%17.8%36.1%21.1%

Price Volatility Vs. Market

How volatile is Raytheon's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Raytheon undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RTN ($116.96) is trading below our estimate of fair value ($357.98)

Significantly Below Fair Value: RTN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RTN is good value based on its PE Ratio (9.8x) compared to the Aerospace & Defense industry average (12.8x).

PE vs Market: RTN is good value based on its PE Ratio (9.8x) compared to the US market (12.4x).


Price to Earnings Growth Ratio

PEG Ratio: RTN is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: RTN is overvalued based on its PB Ratio (2.7x) compared to the US Aerospace & Defense industry average (1.7x).


Next Steps

Future Growth

How is Raytheon forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

7.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RTN's forecast earnings growth (7.6% per year) is above the savings rate (1.7%).

Earnings vs Market: RTN's earnings (7.6% per year) are forecast to grow slower than the US market (13.4% per year).

High Growth Earnings: RTN's earnings are forecast to grow, but not significantly.

Revenue vs Market: RTN's revenue (5.4% per year) is forecast to grow slower than the US market (7.1% per year).

High Growth Revenue: RTN's revenue (5.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RTN's Return on Equity is forecast to be high in 3 years time (21.5%)


Next Steps

Past Performance

How has Raytheon performed over the past 5 years?

9.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RTN has high quality earnings.

Growing Profit Margin: RTN's current net profit margins (11.5%) are higher than last year (10.8%).


Past Earnings Growth Analysis

Earnings Trend: RTN's earnings have grown by 9.5% per year over the past 5 years.

Accelerating Growth: RTN's earnings growth over the past year (14.8%) exceeds its 5-year average (9.5% per year).

Earnings vs Industry: RTN earnings growth over the past year (14.8%) exceeded the Aerospace & Defense industry 3%.


Return on Equity

High ROE: RTN's Return on Equity (27.2%) is considered high.


Next Steps

Financial Health

How is Raytheon's financial position?


Financial Position Analysis

Short Term Liabilities: RTN's short term assets ($13.1B) exceed its short term liabilities ($9.8B).

Long Term Liabilities: RTN's short term assets ($13.1B) exceed its long term liabilities ($12.5B).


Debt to Equity History and Analysis

Debt Level: RTN's debt to equity ratio (38.8%) is considered satisfactory.

Reducing Debt: RTN's debt to equity ratio has reduced from 54.8% to 38.8% over the past 5 years.

Debt Coverage: RTN's debt is well covered by operating cash flow (94.1%).

Interest Coverage: RTN's interest payments on its debt are well covered by EBIT (30x coverage).


Balance Sheet


Next Steps

Dividend

What is Raytheon's current dividend yield, its reliability and sustainability?

3.22%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RTN's dividend (3.22%) is higher than the bottom 25% of dividend payers in the US market (2.05%).

High Dividend: RTN's dividend (3.22%) is low compared to the top 25% of dividend payers in the US market (5.71%).


Stability and Growth of Payments

Stable Dividend: RTN's dividends per share have been stable in the past 10 years.

Growing Dividend: RTN's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (31.6%), RTN's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RTN's dividends in 3 years are forecast to be well covered by earnings (28.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.3yrs

Average management tenure


CEO

Tom Kennedy (63yo)

6s

Tenure

US$22,420,258

Compensation

Dr. Thomas A. Kennedy, also known as Tom, Ph.D., has served as Chairman of the Board of Raytheon Company since October 2014, Chief Executive Officer since April 2014 and a Director since January 2014. From ...


CEO Compensation Analysis

Compensation vs Market: Tom's total compensation ($USD22.42M) is above average for companies of similar size in the US market ($USD11.95M).

Compensation vs Earnings: Tom's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Thomas Kennedy
Chairman & CEO6yrsUS$22.42m0.051% $16.6m
Anthony O'Brien
VP & CFO5.08yrsUS$6.11m0.016% $5.1m
David Wajsgras
VP and President of Intelligenceno dataUS$5.49m0.042% $13.8m
Wesley Kremer
VP & President of Missile Systems4.75yrsUS$5.34m0.012% $3.8m
Michael Wood
VP, Controller & Chief Accounting Officer13.5yrsno data0.0046% $1.5m
Kelsey DeBriyn
Vice President of Investor Relations2.17yrsno datano data
Frank Jimenez
VP, General Counsel & Corporate Secretary5.25yrsUS$5.49m0.0096% $3.1m
Pamela Wickham
Vice President of Corporate Affairs & Communications15.08yrsno datano data
Scott Weiner
Vice President of Corporate Development1.25yrsno datano data
Randa Newsome
Vice President of Human Resources & Global Security5.25yrsno data0.0071% $2.3m

5.3yrs

Average Tenure

54yo

Average Age

Experienced Management: RTN's management team is seasoned and experienced (5.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Thomas Kennedy
Chairman & CEO6yrsUS$22.42m0.051% $16.6m
Robert Beauchamp
Independent Director4.75yrsUS$373.45k0.0021% $683.9k
William Spivey
Independent Director21.25yrsUS$294.95k0.0083% $2.7m
Dinesh Paliwal
Independent Director3.58yrsUS$273.45k0.0010% $328.9k
George Oliver
Independent Director6.42yrsUS$292.45k0.0025% $814.2k
Tracy Atkinson
Independent Director5.75yrsUS$307.95k0.0016% $511.3k
Stephen Hadley
Independent Director10.75yrsUS$304.95k0.0025% $801.1k
Letitia Long
Independent Director5.08yrsUS$314.45k0.00072% $234.5k
Robert Work
Independent Director2.67yrsUS$294.45kno data
James Winnefeld
Independent Director3.25yrsUS$292.45k0.0010% $328.9k

5.3yrs

Average Tenure

62.5yo

Average Age

Experienced Board: RTN's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: RTN insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Raytheon Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Raytheon Company
  • Ticker: RTN
  • Exchange: NYSE
  • Founded: 1922
  • Industry: Aerospace and Defense
  • Sector: Capital Goods
  • Market Cap: US$32.566b
  • Shares outstanding: 278.44m
  • Website: https://www.raytheon.com

Number of Employees


Location

  • Raytheon Company
  • 870 Winter Street
  • Waltham
  • Massachusetts
  • 02451-1449
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RTNNYSE (New York Stock Exchange)YesCommon Stock Par Value 0.01USUSDMay 2001
RTN1DB (Deutsche Boerse AG)YesCommon Stock Par Value 0.01DEEURMay 2001
RTN1XTRA (XETRA Trading Platform)YesCommon Stock Par Value 0.01DEEURMay 2001
0KU4LSE (London Stock Exchange)YesCommon Stock Par Value 0.01GBUSDMay 2001
RTN1ETLX (Eurotlx)YesCommon Stock Par Value 0.01ITEURMay 2001
RTN1 *BMV (Bolsa Mexicana de Valores)YesCommon Stock Par Value 0.01MXMXNMay 2001
RATNWBAG (Wiener Boerse AG)YesCommon Stock Par Value 0.01ATEURMay 2001

Biography

Raytheon Company develops integrated products, services, and solutions for the defense and other government markets worldwide. It operates through five segments: Integrated Defense Systems (IDS); Intelligence, Information and Services (IIS); Missile Systems (MS); Space and Airborne Systems (SAS); and Forcepoint. The IDS segment offers integrated air and missile defense; land-and sea-based radar solutions; command, control, communications, computers, cyber, and intelligence solutions; naval combat and ship electronic and sensing systems; and undersea sensing and effects solutions. The IIS segment provides technical and professional services, such as navigation, space and weather solutions, cybersecurity, analytics, training, logistics, mission support, software-based systems, automation and sustainment solutions, and air traffic management systems, as well as intelligence, surveillance, and reconnaissance solutions. The MS segment develops and supports weapon systems comprising missiles, smart munitions, close-in weapon systems, projectiles, kinetic kill vehicles, directed energy effectors, and combat sensor solutions. The SAS segment provides civil and military electro-optical/infrared sensors; airborne radars for surveillance and fire control applications; lasers; precision guidance systems; signals intelligence systems; processors; electronic warfare systems; tactical and strategic communications; and space-qualified systems. The Forcepoint segment offers cyber security products that include risk adaptive data loss prevention; user and entity behavior analytics and cloud access security broker capabilities; insider threat solutions; firewall technology; cloud and on premise Web and email security; and cross domain transfer products. The company was founded in 1922 and is headquartered in Waltham, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/04 03:56
End of Day Share Price2020/04/02 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.