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United Technologies (RTX) Gains As Market Dips: What You Should Know

Zacks Equity Research

United Technologies (RTX) closed at $65.43 in the latest trading session, marking a +0.55% move from the prior day. This move outpaced the S&P 500's daily loss of 0.52%. At the same time, the Dow lost 0.13%, and the tech-heavy Nasdaq lost 1.4%.

Coming into today, shares of the maker of elevators, jet engines and other products had lost 33.93% in the past month. In that same time, the Aerospace sector lost 5.62%, while the S&P 500 gained 13.35%.

RTX will be looking to display strength as it nears its next earnings release, which is expected to be May 7, 2020. On that day, RTX is projected to report earnings of $1.11 per share, which would represent a year-over-year decline of 41.88%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $18.14 billion, down 1.25% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.60 per share and revenue of $68.93 billion, which would represent changes of -56.42% and -10.54%, respectively, from the prior year.

Any recent changes to analyst estimates for RTX should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 54.35% lower. RTX is currently sporting a Zacks Rank of #5 (Strong Sell).

Valuation is also important, so investors should note that RTX has a Forward P/E ratio of 18.08 right now. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 18.08.

We can also see that RTX currently has a PEG ratio of 1.51. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. RTX's industry had an average PEG ratio of 3.01 as of yesterday's close.

The Aerospace - Defense Equipment industry is part of the Aerospace sector. This group has a Zacks Industry Rank of 184, putting it in the bottom 28% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow RTX in the coming trading sessions, be sure to utilize Zacks.com.


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