RTX (NYSE:RTX) this year is likely to be less profitable than previously estimated, analysts at financial-services firm Wells Fargo said in revising their forecast for the aerospace and defense company, whose operations include Collins Aerospace and jet-engine maker Pratt & Whitney.
The revision comes as investors “appear to have concerns” about makers of jet engines, especially after aviation giant Airbus (OTCPK:EADSY) (OTCPK:EADSF) cut its target for plane deliveries to 770 from 800 previously for the year, according to Wells Fargo. RTX (RTX) generates more profit from original equipment than engine makers such as GE Aerospace (GE) does, because Collins Aerospace makes avionics, power systems and interiors for planes.
“The impact from 30 fewer Airbus deliveries (about 4%) is still fairly small,” Matthew Akers, analyst at Wells Fargo, said in a June 28 report. “We trim our 2024 sales forecast by approximately 2% at Collins, with EPS coming down by about $0.05 for the year.”
RTX (RTX) is likely to report results for the second quarter on July 23, according to an estimate from Zacks Investment Research. It will be RTX’s (RTX) first earnings report from Chief Executive Chris Calio, who succeeded former company head Gregory Hayes on May 2.
“Another common investor concern we hear is that RTX (RTX) could revise down its 2025 guidance with second-quarter results,” according to Wells Fargo. “The second quarter will be the first opportunity for Chris to put his own stamp on the long-term outlook.”
Wells Fargo raised its price target on RTX (RTX) to $141 a share from $139 a share previously, based on a multiple of 26 times 2026 results.
In the same report, Wells Fargo raised its 2024 earnings estimate for GE Aerospace (GE).
| Wells Fargo’s estimates for RTX (RTX), as of June 28 | |||
| Adjusted diluted EPS | |||
| New | Old | ||
| 2024 | $5.35 | $5.40 | |
| 2025 | $6.24 | $6.32 | |