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Raytheon Technologies (RTX) Q3 Earnings Beat, Sales View Down
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Raytheon Technologies Corporation’s (RTX - Free Report) third-quarter 2022 adjusted earnings per share (EPS) of $1.21 beat the Zacks Consensus Estimate of $1.11 by 9%. However, the bottom-line figure dropped 4% from the year-ago quarter’s adjusted earnings of $1.26 due to the absence of a prior year tax benefit and lower pension income.
Including one-time items, the company reported GAAP earnings of 94 cents compared with 93 cents per share recorded in the year-ago quarter.
Operational Performance
Raytheon Technologies’ third-quarter sales of $16,951 million missed the Zacks Consensus Estimate of $17,003 million by 0.3%. The sales figure, however, rose 5% from $16,213 million recorded in the year-ago quarter.
Total costs and expenses increased 3.5% year over year to $15,517 million. The company generated an operating profit of $1,480 million compared with $1,343 million in the year-ago quarter.
Raytheon Technologies Corporation Price, Consensus and EPS Surprise
Collins Aerospace: Sales at this segment improved 11% year over year to $5,100 million in third-quarter 2022, driven by higher commercial aftermarket as well as commercial OEM sales backed by recovering commercial air traffic and higher narrowbody deliveries.
Its adjusted operating income came in at $630 million compared with the year-ago quarter’s level of $480 million.
Pratt & Whitney: Sales at this segment rose 14% year over year to $5,380 million, driven by growth in the commercial aftermarket, military as well as commercial OEM businesses, backed by higher shop visits and related spare part sales as well as favorable OEM engine mix and volume.
Its adjusted operating profit was $318 million compared with the year-ago quarter’s operating profit of $189 million.
Raytheon Intelligence & Space: This segment recorded third-quarter sales of $3,626 million, down 3% year over year, driven by the divestiture of the Global Training and Services business.
Its operating profit was $371 million, marking a decline of 5%.
Raytheon Missiles & Defense: This unit recorded sales of $3,678 million, down 6% year over year. The unit recorded a $416 million adjusted operating profit in the third quarter, down 15%.
Financial Update
Raytheon Technologies had cash and cash equivalents of $5,381 million as of Sep 30, 2022, compared with $7,832 million as of Dec 31, 2021.
Long-term debt was $31,059 million as of Sep 30, 2022, down from $31,327 million as of Dec 31, 2021.
Net cash inflow from operating activities amounted to $2,540 million as of Sep 30, 2022 compared with $3,981 million at the end of third-quarter 2021.
Its free cash flow was $1,107 million at the end of third-quarter 2022 compared with $2,801 million at the end of third-quarter 2021.
Guidance
Raytheon Technologies updated its financial guidance for 2022.
The company currently projects adjusted EPS in the range of $4.70-$4.80 compared with the prior guidance range of $4.60-$4.80. The Zacks Consensus Estimate for Raytheon’s 2022 EPS, pegged at $4.65 lies below the company’s guided range.
The company now expects revenues in the range of $67.00-$67.30 compared with the prior range of $67.75-$68.75 billion. The Zacks Consensus Estimate for revenues, pegged at $66.84 billion, lies below the company’s guidance.
The company still expects to generate free cash flow worth approximately $6 billion.
Zacks Rank
Raytheon Technologies currently carries a Zacks Rank #4 (Sell).
Spirit AeroSystems (SPR - Free Report) is scheduled to release its third-quarter results on Nov 3.
SPR delivered a four-quarter average negative earnings surprise of 100.31%. The Zacks Consensus Estimate for Spirit AeroSystem’s third-quarter bottom line is pegged at a loss of 39 cents, which implies a solid improvement from a loss of $1.13 incurred in the third quarter of 2021.
Huntington Ingalls Industries (HII - Free Report) is slated to release its third-quarter results on Nov 3.
HII delivered a four-quarter average earnings surprise of 12.38%. The Zacks Consensus Estimate for Huntington’s third-quarter earnings, pegged at $3.53, suggests a decline of 3.3% from the third quarter of 2021.
Spire (SPIR - Free Report) is slated to report its third-quarter results on Nov 9.
The Zacks Consensus Estimate for SPIR’s third-quarter earnings, pegged at a loss of 10 cents, has remained unchanged over the past seven days. SPIR boasts a long-term earnings growth rate of 7.9%.
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Raytheon Technologies (RTX) Q3 Earnings Beat, Sales View Down
Raytheon Technologies Corporation’s (RTX - Free Report) third-quarter 2022 adjusted earnings per share (EPS) of $1.21 beat the Zacks Consensus Estimate of $1.11 by 9%. However, the bottom-line figure dropped 4% from the year-ago quarter’s adjusted earnings of $1.26 due to the absence of a prior year tax benefit and lower pension income.
Including one-time items, the company reported GAAP earnings of 94 cents compared with 93 cents per share recorded in the year-ago quarter.
Operational Performance
Raytheon Technologies’ third-quarter sales of $16,951 million missed the Zacks Consensus Estimate of $17,003 million by 0.3%. The sales figure, however, rose 5% from $16,213 million recorded in the year-ago quarter.
Total costs and expenses increased 3.5% year over year to $15,517 million. The company generated an operating profit of $1,480 million compared with $1,343 million in the year-ago quarter.
Raytheon Technologies Corporation Price, Consensus and EPS Surprise
Raytheon Technologies Corporation price-consensus-eps-surprise-chart | Raytheon Technologies Corporation Quote
Segmental Performance
Collins Aerospace: Sales at this segment improved 11% year over year to $5,100 million in third-quarter 2022, driven by higher commercial aftermarket as well as commercial OEM sales backed by recovering commercial air traffic and higher narrowbody deliveries.
Its adjusted operating income came in at $630 million compared with the year-ago quarter’s level of $480 million.
Pratt & Whitney: Sales at this segment rose 14% year over year to $5,380 million, driven by growth in the commercial aftermarket, military as well as commercial OEM businesses, backed by higher shop visits and related spare part sales as well as favorable OEM engine mix and volume.
Its adjusted operating profit was $318 million compared with the year-ago quarter’s operating profit of $189 million.
Raytheon Intelligence & Space: This segment recorded third-quarter sales of $3,626 million, down 3% year over year, driven by the divestiture of the Global Training and Services business.
Its operating profit was $371 million, marking a decline of 5%.
Raytheon Missiles & Defense: This unit recorded sales of $3,678 million, down 6% year over year. The unit recorded a $416 million adjusted operating profit in the third quarter, down 15%.
Financial Update
Raytheon Technologies had cash and cash equivalents of $5,381 million as of Sep 30, 2022, compared with $7,832 million as of Dec 31, 2021.
Long-term debt was $31,059 million as of Sep 30, 2022, down from $31,327 million as of Dec 31, 2021.
Net cash inflow from operating activities amounted to $2,540 million as of Sep 30, 2022 compared with $3,981 million at the end of third-quarter 2021.
Its free cash flow was $1,107 million at the end of third-quarter 2022 compared with $2,801 million at the end of third-quarter 2021.
Guidance
Raytheon Technologies updated its financial guidance for 2022.
The company currently projects adjusted EPS in the range of $4.70-$4.80 compared with the prior guidance range of $4.60-$4.80. The Zacks Consensus Estimate for Raytheon’s 2022 EPS, pegged at $4.65 lies below the company’s guided range.
The company now expects revenues in the range of $67.00-$67.30 compared with the prior range of $67.75-$68.75 billion. The Zacks Consensus Estimate for revenues, pegged at $66.84 billion, lies below the company’s guidance.
The company still expects to generate free cash flow worth approximately $6 billion.
Zacks Rank
Raytheon Technologies currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Defense Releases
Spirit AeroSystems (SPR - Free Report) is scheduled to release its third-quarter results on Nov 3.
SPR delivered a four-quarter average negative earnings surprise of 100.31%. The Zacks Consensus Estimate for Spirit AeroSystem’s third-quarter bottom line is pegged at a loss of 39 cents, which implies a solid improvement from a loss of $1.13 incurred in the third quarter of 2021.
Huntington Ingalls Industries (HII - Free Report) is slated to release its third-quarter results on Nov 3.
HII delivered a four-quarter average earnings surprise of 12.38%. The Zacks Consensus Estimate for Huntington’s third-quarter earnings, pegged at $3.53, suggests a decline of 3.3% from the third quarter of 2021.
Spire (SPIR - Free Report) is slated to report its third-quarter results on Nov 9.
The Zacks Consensus Estimate for SPIR’s third-quarter earnings, pegged at a loss of 10 cents, has remained unchanged over the past seven days. SPIR boasts a long-term earnings growth rate of 7.9%.