Yahoo Finance Raytheon Technologies Corporation (NYSE:RTX) Just Released Its First-Quarter Earnings: Here's What Analysts Think
Shareholders might have noticed that Raytheon Technologies Corporation (NYSE:RTX) filed its first-quarter result this time last week. The early response was not positive, with shares down 3.4% to US$99.39 in the past week. The result was positive overall - although revenues of US$17b were in line with what the analysts predicted, Raytheon Technologies surprised by delivering a statutory profit of US$0.97 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Raytheon Technologies
Taking into account the latest results, the most recent consensus for Raytheon Technologies from 20 analysts is for revenues of US$72.6b in 2023 which, if met, would be a modest 5.9% increase on its sales over the past 12 months. Per-share earnings are expected to ascend 11% to US$4.20. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$72.4b and earnings per share (EPS) of US$4.25 in 2023. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The analysts reconfirmed their price target of US$110, showing that the business is executing well and in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Raytheon Technologies at US$120 per share, while the most bearish prices it at US$100.00. This is a very narrow spread of estimates, implying either that Raytheon Technologies is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Raytheon Technologies' growth to accelerate, with the forecast 8.0% annualised growth to the end of 2023 ranking favourably alongside historical growth of 4.7% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Raytheon Technologies is expected to grow much faster than its industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. The consensus price target held steady at US$110, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Raytheon Technologies going out to 2025, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Raytheon Technologies .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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