November 30, 2023
Top 10 Stock Raytheon Technologies Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Raytheon Technologies – Top 10 Stock in Dow Jones U.S. Aerospace & Defense Index
Raytheon Technologies is listed as a top 10 stock on November 30, 2023 in the market index D.J. US Defense because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 51 (high 51% performer), Obermatt assesses an overall buy recommendation for Raytheon Technologies on November 30, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Aerospace & Defense |
| Index | Dividends USA, D.J. US Defense, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Raytheon Technologies Buy
| 360 METRICS | November 30, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 92 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 35 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 37 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 32 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 51 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 51 (better than 51% compared with alternatives), overall professional sentiment and financial characteristics for the stock Raytheon Technologies are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Raytheon Technologies. Only the consolidated Value Rank has an attractive rank of 92, which means that the share price of Raytheon Technologies is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 92% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 35, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 37, meaning the company has a riskier financing structure than 63% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 68% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 32. ...read more
RECOMMENDATION: With a consolidated 360° View of 51, Raytheon Technologies is better positioned than 51% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 92. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 35), a riskier financing structure than the competition (Safety Rank of 37), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 32) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Raytheon Technologies is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Raytheon Technologies. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Raytheon Technologies only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 32 (better than 32% compared with alternatives), overall professional sentiment and engagement for the stock Raytheon Technologies is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Raytheon Technologies. Analyst Opinions are at a rank of 11 (worse than 89% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 47, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 47, which means that professional investors hold less stock in this company than in 53% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Raytheon Technologies is Market Pulse, with a rank of 55, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 55% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 32 (less encouraging than 68% compared with investment alternatives), Raytheon Technologies has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Raytheon Technologies Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 92 (better than 92% compared with alternatives) for 2023, Raytheon Technologies shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Raytheon Technologies. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 67 which means that the stock price compared with what market professionals expect for future profits is lower than for 67% of comparable companies, indicating a good value concerning Raytheon Technologies's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 67, and for Dividend Yield with a Dividend Yield Rank of 96. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 53% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 47). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 92, is a buy recommendation based on Raytheon Technologies's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Raytheon Technologies has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Raytheon Technologies shares. ...read more
Growth Strategy: Raytheon Technologies Growth Momentum low
| GROWTH METRICS | November 30, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 60 |
|
||||||
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 32 |
|
||||||
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 83 |
|
||||||
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 17 |
|
||||||
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 35 |
|
||||||
ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), Raytheon Technologies shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Raytheon Technologies. Sales Growth has a rank of 60 which means that currently, professionals expect the company to grow more than 60% of its competitors. Capital Growth is also above 32% of competitors with a rank of 83. But Profit Growth only has a rank of 32, which means that currently professionals expect the company to grow its profits less than 68% of its competitors. And Stock Returns have also been below average with a rank of only 17. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. ...read more
Safety Strategy: Raytheon Technologies Debt Financing Safety below-average
| SAFETY METRICS | November 30, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 64 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 12 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 46 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 37 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 37 (better than 37% compared with alternatives), the company Raytheon Technologies has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Raytheon Technologies is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Raytheon Technologies and the other two below average. Leverage is at a rank of 64 meaning the company has a below-average debt-to-equity ratio. It has less debt than 64% of its competitors.Refinancing is at a rank of 12, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 88% of its competitors. Liquidity is at a rank of 46, meaning that the company generates less profit to service its debt than 54% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 37 (worse than 63% compared with alternatives), Raytheon Technologies has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Raytheon Technologies are on the safer side. ...read more
Combined financial peformance: Raytheon Technologies Above-Average Financial Performance
| COMBINED PERFORMANCE | November 30, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 92 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 35 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 46 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 66 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 66 (better than 66% compared with investment alternatives), Raytheon Technologies (Aerospace & Defense, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Raytheon Technologies are a good value (attractively priced) with a consolidated Value Rank of 92 (better than 92% of alternatives) but show below-average growth (Growth Rank of 35), and are riskily financed (Safety Rank of 37), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 66, is a buy recommendation based on Raytheon Technologies's financial characteristics. As the company Raytheon Technologies's key financial metrics exhibit good value (Obermatt Value Rank of 92) but low growth (Obermatt Growth Rank of 35) and risky financing practices (Obermatt Safety Rank of 37), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 92% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.