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What's in Store for Raytheon Technologies (RTX) in Q1 Earnings?

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Raytheon Technologies Corp. (RTX - Free Report) is set to release first-quarter 2022 results on Apr 26, before market open.

The company delivered an earnings surprise of 6.93% in the last reported quarter. Moreover, Raytheon delivered an earnings surprise of 9.73% in the last four quarters, on average.

Factors to Note

The merger between legacy missile-maker Raytheon Company with multinational conglomerate United Technologies, resulting in the formation of Raytheon Technologies was completed in April 2021. Consequently, Raytheon Technologies’ first-quarter 2022 results are expected to benefit from the incremental merger synergies. Also, cost synergies from the acquisition of Rockwell Collins are anticipated to bolster the company’s soon-to-be-reported quarter’s results.

A gradual improvement in global air travel has led to a modest recovery of the commercial aerospace industry over the past couple of quarters, which must have boosted domestic narrowbody jets' volume as well as parts and repairs strength. This in turn is likely to have once again boosted the company’s commercial OEM as well as aftermarket sales in the first quarter.

However, lower volume for F-35 jets might have dragged down its military sales, which in turn is projected to have partially marred its overall sales performance. Also, supply chain pressure and headwinds related to the delivery of original equipment for 787 jets might have partially impacted the overall performance of the Collins business unit in the soon-to-be-reported quarter.

Raytheon’s relentless cost-reduction initiatives along with strong operational performance are expected to have benefited its first-quarter earnings.

Q1 Expectations

The Zacks Consensus Estimate for Raytheon Technologies’ first-quarter earnings is pegged at $1.01 on revenues of $15.80 billion, indicating a 12.2% and 3.6% improvement from the respective year-ago quarter numbers.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Raytheon Technologies this time around. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for an earnings beat. This is not the case here.

Earnings ESP: Raytheon Technologies has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stock to Consider

Here is a defense company you may want to consider as it has the right combination of elements to post an earnings beat this season:

Northrop Grumman (NOC - Free Report) has an Earnings ESP of +1.40% and a Zacks Rank #3. NOC has a four-quarter average negative earnings surprise of 11.05%.

The Zacks Consensus Estimate for Northrop’s first quarter is pegged at $5.94 per share, having dipped 0.2% in the past 90 days. NOC boasts a long-term earnings growth rate of 6.2%.

Other Defense Earnings Coming Up

General Dynamics (GD - Free Report) is scheduled to release its first-quarter results on Apr 27. It holds a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

GD delivered a four-quarter average earnings surprise of 3.72%. The Zacks Consensus Estimate for General Dynamics’ first-quarter earnings, pegged at $2.49, has remained unchanged over the past 30 days. GD boasts a long-term earnings growth rate of 9.6%.

Textron (TXT - Free Report) is scheduled to release its first-quarter results on Apr 28. It holds a Zacks Rank #3.

The Zacks Consensus Estimate for Textron’s first-quarter earnings, pegged at 74 cents, has declined 3.9% over the past 30 days. TXT boasts a long-term earnings growth rate of 11.8%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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