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Raytheon (RTX) Arm Wins 90 GTF Engine Orders From Viva Aerobus
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Raytheon Technologies Corp.’s (RTX - Free Report) arm, Pratt & Whitney, recently announced that its GTF Engine order book has been enhanced by Viva Aerobus’ latest order to power its 90 more Airbus A321neo aircraft. The deal follows the airline’s previous order to power 65 A320neo family aircraft.
Pratt & Whitney now has a firm commitment to deliver 155 GTF Engines from its order book to Viva Aerobus. This indicates the strong demand the product enjoys, buoyed by its ability to provide superior economic and environmental advantages to airline operators.
What’s Favoring Raytheon?
An increased focus on environmental stewardship acts as a catalyst for the strong demand for GTF Engines from major airlines and aircraft manufacturers. With an increased emphasis on investing in more fuel-efficient aircraft, exploring alternative fuels and implementing eco-friendly practices to reduce carbon emissions, Pratt & Whitney’s GTF Engine may continue to witness a solid order flow. The latest order from Viva Aerobus is a bright example of that.
To meet the robust demand for its engines, RTX has declared an investment worth $206 million for capacity expansion at its Columbus, Georgia business. This is likely to increase the overhaul capacity to 400 GTF Engines per year. Such capacity enhancement, backed by strong demand, is likely to fetch a handful of returns for RTX from its Pratt & Whitney business unit.
Key Patrons of GTF Engines
GTF Engines have gathered significant traction among customers in both domestic and international markets. In 2022, the engine was chosen by Cessna SkyCourier, Daher Kodiak 900 and TBM960. The engine is also part of the coveted lineup of Airbus (EADSY - Free Report) and Embraer (ERJ - Free Report) aircraft.
The Airbus A320neo family and the Airbus A220 are the two Airbus aircraft models powered with Raytheon’s GTF Engine and deliver the highest fuel efficiency and the lowest CO2 emission for the family.
Airbus inked a major order to supply 500 of its A320 family aircraft at the Paris Air Show 2023 to Indigo, the biggest order in commercial aviation history. This should usher in a supply order for RTX’s GTF Engines as well.
Embraer’s E2 family of aircraft is fitted with GTF Engines. E2 jets enjoy strong demand due to the GTF Engine’s fuel efficiency, and less carbon and noise footprint.
As of Mar 31, 2023, Embraer’s E-Jets E2 had 281 orders in the backlog. Considering the valued demand for its E-jet family of aircraft, the company may continue to witness the solid delivery of these jets in the coming quarters, highlighting the strong demand for GTF Engines.
Price Movement
In the past year, shares of Raytheon Technologies have increased 2.8% compared with the industry’s growth of 9.9%.
The long-term earnings growth rate of TDG is projected at 25.1%. The consensus estimate for its 2023 earnings implies a growth rate of 40.2% from the prior-year reported figure.
The Zacks Consensus Estimate for Transdigm’s 2024 sales calls for a growth rate of 11% from the prior-year estimated figure. The Zacks Consensus Estimate for its 2024 earnings indicates a growth rate of 19.4% from the prior-year reported figure.
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Raytheon (RTX) Arm Wins 90 GTF Engine Orders From Viva Aerobus
Raytheon Technologies Corp.’s (RTX - Free Report) arm, Pratt & Whitney, recently announced that its GTF Engine order book has been enhanced by Viva Aerobus’ latest order to power its 90 more Airbus A321neo aircraft. The deal follows the airline’s previous order to power 65 A320neo family aircraft.
Pratt & Whitney now has a firm commitment to deliver 155 GTF Engines from its order book to Viva Aerobus. This indicates the strong demand the product enjoys, buoyed by its ability to provide superior economic and environmental advantages to airline operators.
What’s Favoring Raytheon?
An increased focus on environmental stewardship acts as a catalyst for the strong demand for GTF Engines from major airlines and aircraft manufacturers. With an increased emphasis on investing in more fuel-efficient aircraft, exploring alternative fuels and implementing eco-friendly practices to reduce carbon emissions, Pratt & Whitney’s GTF Engine may continue to witness a solid order flow. The latest order from Viva Aerobus is a bright example of that.
To meet the robust demand for its engines, RTX has declared an investment worth $206 million for capacity expansion at its Columbus, Georgia business. This is likely to increase the overhaul capacity to 400 GTF Engines per year. Such capacity enhancement, backed by strong demand, is likely to fetch a handful of returns for RTX from its Pratt & Whitney business unit.
Key Patrons of GTF Engines
GTF Engines have gathered significant traction among customers in both domestic and international markets. In 2022, the engine was chosen by Cessna SkyCourier, Daher Kodiak 900 and TBM960. The engine is also part of the coveted lineup of Airbus (EADSY - Free Report) and Embraer (ERJ - Free Report) aircraft.
The Airbus A320neo family and the Airbus A220 are the two Airbus aircraft models powered with Raytheon’s GTF Engine and deliver the highest fuel efficiency and the lowest CO2 emission for the family.
Airbus inked a major order to supply 500 of its A320 family aircraft at the Paris Air Show 2023 to Indigo, the biggest order in commercial aviation history. This should usher in a supply order for RTX’s GTF Engines as well.
Embraer’s E2 family of aircraft is fitted with GTF Engines. E2 jets enjoy strong demand due to the GTF Engine’s fuel efficiency, and less carbon and noise footprint.
As of Mar 31, 2023, Embraer’s E-Jets E2 had 281 orders in the backlog. Considering the valued demand for its E-jet family of aircraft, the company may continue to witness the solid delivery of these jets in the coming quarters, highlighting the strong demand for GTF Engines.
Price Movement
In the past year, shares of Raytheon Technologies have increased 2.8% compared with the industry’s growth of 9.9%.
Image Source: Zacks Investment Research
Zacks Rank & a Stock to Consider
Raytheon Technologies currently carries a Zacks Rank #3 (Hold). One better-ranked stock in the same industry is Transdigm Group (TDG - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term earnings growth rate of TDG is projected at 25.1%. The consensus estimate for its 2023 earnings implies a growth rate of 40.2% from the prior-year reported figure.
The Zacks Consensus Estimate for Transdigm’s 2024 sales calls for a growth rate of 11% from the prior-year estimated figure. The Zacks Consensus Estimate for its 2024 earnings indicates a growth rate of 19.4% from the prior-year reported figure.