NYSE:RTN

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

Outstanding track record established dividend payer.


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


Market Performance


7 Day Return

2.2%

RTN

1.3%

US Aerospace & Defense

2.3%

US Market


1 Year Return

3.8%

RTN

7.7%

US Aerospace & Defense

5.6%

US Market

Return vs Industry: RTN underperformed the US Aerospace & Defense industry which returned 7.7% over the past year.

Return vs Market: RTN underperformed the US Market which returned 5.6% over the past year.


Shareholder returns

RTNIndustryMarket
7 Day2.2%1.3%2.3%
30 Day-1.8%-2.5%-1.0%
90 Day13.8%5.1%-0.7%
1 Year6.0%3.8%9.8%7.7%7.9%5.6%
3 Year54.5%45.8%61.6%52.8%45.6%36.3%
5 Year128.3%105.6%101.1%82.1%65.8%47.6%

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?

14.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: RTN ($200.38) is trading below our estimate of fair value ($234.32)

Significantly Undervalued: RTN is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: RTN is good value based on its PE Ratio (18.4x) compared to the Aerospace & Defense industry average (22.4x).

PE vs Market: RTN is poor value based on its PE Ratio (18.4x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: RTN is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: RTN is overvalued based on its PB Ratio (4.6x) compared to the US Aerospace & Defense industry average (2.4x).


Next Steps

Future Growth

How is Raytheon forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

8.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RTN's forecast earnings growth (8.7% per year) is above the savings rate (2.7%).

Earnings vs Market: RTN's earnings (8.7% per year) are forecast to grow slower than the US market (14.5% per year).

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

Revenue vs Market: RTN's revenue (5% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: RTN's revenue (5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: RTN's Return on Equity is forecast to be high in 3 years time (25.9%)


Next Steps

Past Performance

How has Raytheon performed over the past 5 years?

6.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: RTN's earnings have grown by 6.7% per year over the past 5 years.

Accelerating Growth: RTN's earnings growth over the past year (28.3%) exceeds its 5-year average (6.7% per year).

Earnings vs Industry: RTN earnings growth over the past year (28.3%) exceeded the Aerospace & Defense industry 12.2%.


Return on Equity

High ROE: RTN's Return on Equity (24.2%) is considered high.


Return on Assets

ROA vs Industry: RTN has a higher Return on Assets than the Aerospace & Defense industry average last year.


Return on Capital Employed

ROCE Improving: RTN has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Raytheon's financial position?


Financial Position Analysis

Short Term Liabilities: RTN's short term assets ($11.5B) exceeds its short term liabilities ($7.9B)

Long Term Liabilities: RTN's short term assets (11.5B) do not cover its long term liabilities (11.7B)


Debt to Equity History and Analysis

Debt Level: RTN's debt to equity ratio (40%) is considered high

Reducing Debt: RTN's debt to equity ratio has increased from 39.8% to 40% over the past 5 years.

Debt Coverage: RTN's debt is well covered by operating cash flow (47.5%).

Interest Coverage: RTN's interest payments on its debt are well covered by EBIT (25x coverage).


Balance Sheet

Inventory Level: RTN has a low level of unsold assets or inventory.

Debt Coverage by Assets: RTN's debt is covered by short term assets (assets are 2.279210x debt).


Next Steps

Dividend

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

1.88%

Current Dividend Yield


Dividend Yield vs Market

company1.9%marketbottom25%1.5%markettop25%3.8%industryaverage1.8%forecastin3Years2.0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: RTN's dividend (1.88%) is higher than the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: RTN's dividend (1.88%) is low compared to the top 25% of dividend payers in the US market (3.76%).

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 (33.3%), 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 (28.6% payout ratio).


Next Steps

Management

What is the CEO of Raytheon's salary, the management and board of directors tenure and is there insider trading?

4.8yrs

Average management tenure


CEO

Tom Kennedy (63yo)

5.5yrs

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 ($USD22.42M) is about average for companies of similar size in the US market ($USD11.23M).

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


Management Age and Tenure

4.8yrs

Average Tenure

56yo

Average Age

Experienced Management: RTN's management team is considered experienced (4.8 years average tenure).


Board Age and Tenure

5.1yrs

Average Tenure

62.5yo

Average Age

Experienced Board: RTN's board of directors are considered experienced (5.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$8524 Apr 19
Stephen Hadley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares0.47
Max PriceUS$182.49

Ownership Breakdown


Management Team

  • Dave Wajsgras (59yo)

    VP and President of Intelligence

    • Tenure: 0yrs
    • Compensation: US$5.49m
  • Tom Kennedy (63yo)

    Chairman & CEO

    • Tenure: 5.5yrs
    • Compensation: US$22.42m
  • Pam Wickham (56yo)

    Vice President of Corporate Affairs & Communications

    • Tenure: 14.6yrs
  • Mike Wood (51yo)

    VP, Controller & Chief Accounting Officer

    • Tenure: 13yrs
  • Toby O'Brien (54yo)

    VP & CFO

    • Tenure: 4.6yrs
    • Compensation: US$6.11m
  • Mark Russell (57yo)

    Vice President of Engineering

    • Tenure: 11.3yrs
  • Fran Jimenez (54yo)

    VP, General Counsel & Corporate Secretary

    • Tenure: 4.8yrs
    • Compensation: US$5.49m
  • Kelsey DeBriyn

    Vice President of Investor Relations

    • Tenure: 1.7yrs
  • Wesley Kremer (54yo)

    VP & President of Missile Systems

    • Tenure: 4.3yrs
    • Compensation: US$5.34m
  • Kevin Neifert (58yo)

    Chief Information Officer

    • Tenure: 3.8yrs

Board Members

  • Bob Beauchamp (59yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: US$373.45k
  • Bill Spivey (72yo)

    Independent Director

    • Tenure: 20.8yrs
    • Compensation: US$294.95k
  • Dinesh Paliwal (62yo)

    Independent Director

    • Tenure: 3.1yrs
    • Compensation: US$273.45k
  • Tom Kennedy (63yo)

    Chairman & CEO

    • Tenure: 5.5yrs
    • Compensation: US$22.42m
  • George Oliver (59yo)

    Independent Director

    • Tenure: 5.9yrs
    • Compensation: US$292.45k
  • Vern Clark (74yo)

    Lead Director

    • Tenure: 6.4yrs
    • Compensation: US$373.56k
  • Tracy Atkinson (55yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$307.95k
  • Steve Hadley (72yo)

    Independent Director

    • Tenure: 10.3yrs
    • Compensation: US$304.95k
  • Tish Long (60yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: US$314.45k
  • Sandy Winnefeld (63yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$292.45k

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$55.803b
  • Shares outstanding: 278.49m
  • Website: https://www.raytheon.com

Number of Employees


Location

  • Raytheon Company
  • 870 Winter Street
  • Waltham
  • Massachusetts
  • 2451
  • 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
0KU4LSE (London Stock Exchange)YesCommon Stock Par Value 0.01GBUSDMay 2001
RTN1 *BMV (Bolsa Mexicana de Valores)YesCommon Stock Par Value 0.01MXMXNMay 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); Intellige ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 23:42
End of Day Share Price2019/10/16 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.