Raytheon Company (RTN - Free Report) scaled a new 52-week high of $184.17 during the trading session on Sep 5, before eventually closing a tad lower at $183.08. The stock has delivered a one-year return of about 32.7% compared with industry’s gain of 25.4%.
In the past 52 weeks, Raytheon’s share price has ranged from a low of $ 132.89 to a high of $184.17. Average volume of shares traded in the last three months is approximately 1.3 million.
Why an Upward Trend?
Raytheon’s shares have been on the rise following its consistent performance. Raytheon has delivered positive earnings surprises in all of the last four quarters with an average surprise of 7.87%. In second quarter 2017, Raytheon reported earnings of $1.98 per share, beating the Zacks Consensus Estimate of $1.74 by 13.8%. The long-term earnings growth of the company is presently pegged at 9.67%.
Raytheon offers wide range of combat-proven defense products to its customers and continues to receive orders from all verticals of the U.S. Defense as well as allies of the country. The company secured new booking of $6.5 billion in second quarter and exited the quarter with a backlog of $36.2 billion.
Foreign military contracts continue to be vital growth driver for Raytheon. Rise in radical terrorism has led to growing demand from the Gulf countries and Asia-Pacific regions which are also expected to boost revenues in the time to come. The company is not just dependent on domestic orders with 42% of its current backlog coming from international customers.
Raytheon recently entered a joint venture with the Lockheed Martin Corp. (LMT - Free Report) , named Javelin. Per this contract, both companies will work on procuring Javelin containerized all-up rounds, command launch units, Javelin vehicle launcher-electronics and associated non-recurring engineering.
The rising tension between the United States and the North Korea could further increase the importance of Raytheon's Patriot Air and Missile Defense System. This missile system has already been used by five nations since its inception, in approximately 200 combat engagements against manned and unmanned aircraft, cruise missiles, and tactical ballistic missiles.
Zacks Rank & Stocks to Consider
Raytheon currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space are Teledyne Technologies Incorporated (TDY - Free Report) sporting a Zacks Rank #1 (Strong Buy) and AeroVironment, Inc. (AVAV - Free Report) carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Teledyne Technologies delivered positive earnings surprise in all the past four quarters with an average surprise of 36.1%. Its 2017 Zacks Consensus Estimate moved up 8.6% to $5.70 in last 30 days.
AeroVironment, Inc. delivered positive earnings surprise in three out of the last four quarters with an average surprise of 49.7%. Its 2017 Zacks Consensus Estimate moved up 3.7% to 56 cents in last 30 days.
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