If you’ve been watching the ticker lately, you’ve probably seen the letters RTX popping up more than usual. Honestly, it’s been a wild ride for what used to be considered a "boring" industrial play. As of early 2026, RTX stock is trading around $202, a massive jump from where it sat just a couple of years ago. We’re talking about a company with a market cap of roughly $271 billion. But what is it, actually?
Basically, RTX Corporation—formerly known as Raytheon Technologies—is a massive conglomerate that lives at the intersection of "I’m flying to visit my parents" and "global national security." It’s one of those companies that is so big it’s almost invisible, yet it powers nearly everything in the sky. If you’ve ever sat on a plane or read about a missile defense system, you’ve interacted with their tech.
What is RTX stock and what do they actually do?
To understand the stock, you have to understand the three-headed monster that is their business model. After the big merger between United Technologies and Raytheon back in 2020, they reorganized into three very distinct pieces.
First, you’ve got Collins Aerospace. These folks make the "guts" of the plane. Avionics, flight controls, those little screens in the back of your seat—they do it all. Then there’s Pratt & Whitney. They build the engines. If you see a giant jet engine with a eagle logo on it, that’s them. Lastly, there’s Raytheon, the defense side. This is the part of the company that builds the Patriot missile system and advanced radars.
The beauty of this setup (at least for investors) is the balance. When commercial travel took a nosedive a few years back, the defense side kept the lights on. Now that everyone is flying again and geopolitical tensions are, frankly, a mess, both sides are firing on all cylinders.
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The Numbers That Matter Right Now
- Current Price: Roughly $201.92 (as of mid-January 2026).
- Market Cap: $271 billion.
- Dividend: About $2.72 per share (roughly 1.35% yield).
- Employees: 186,000 people globally.
Why is the stock surging in 2026?
You might be wondering why the price has been climbing like a rocket. It’s not just one thing. It’s a "perfect storm" of high-altitude demand.
For starters, the defense budget is looking massive. President Trump recently proposed a $1.5 trillion military budget for 2027. That’s a huge jump from the $900 billion range. Investors see those numbers and immediately think of RTX because they are the go-to for things like the F-35 fighter jet engines and air defense. When the government spends, RTX usually gets a check.
But it’s not just about war. There’s this thing called the "aftermarket." Because Boeing and Airbus have had so many delays in building new planes, airlines are forced to keep their old planes in the air longer. Older planes need more parts. More repairs. More inspections. Since RTX (through Collins and Pratt & Whitney) owns the rights to those parts, they make a killing on the maintenance. In fact, their commercial aftermarket sales jumped over 20% recently.
The "Powder Metal" Headache
It hasn't all been sunshine and roses. If you're looking at RTX stock, you have to know about the Pratt & Whitney engine issue. A couple of years ago, they discovered a "powder metal" defect in their GTF engines. It sounds technical, but the result was simple: hundreds of planes had to be grounded for inspections.
It cost the company billions. We're talking $3 billion in charges.
Even now, in 2026, about 835 aircraft are still affected. Most companies would fold under that kind of pressure, but RTX has been absorbing the cost because their other segments are so profitable. It’s a reminder that even "safe" stocks have massive engineering risks.
Who owns the company?
If you own an S&P 500 index fund, you probably own a piece of RTX. It’s a favorite for the "big guys." Institutional investors—think Vanguard, BlackRock, and State Street—own about 81% of the total shares.
Interestingly, some big names have been doubling down lately. Ken Griffin’s Citadel and JPMorgan Asset Management both increased their stakes significantly toward the end of 2025. It’s a signal that the "smart money" thinks there’s more room to run, even if the stock is near all-time highs.
Is RTX a good buy compared to its peers?
The defense sector is a crowded neighborhood. You’ve got Lockheed Martin (LMT), Northrop Grumman (NOC), and General Dynamics (GD).
| Metric | RTX | Lockheed Martin | Boeing |
|---|---|---|---|
| Primary Focus | Engines/Diversified | Missiles/F-35 | Commercial Airplanes |
| Beta (Volatility) | 0.44 | 0.50 | 1.50 |
| Dividend Yield | ~1.35% | ~2.4% | N/A |
RTX is sort of the "middle child." It’s less volatile than Boeing (which has been a mess lately) but offers a bit more growth potential in the commercial space than a pure-play defense contractor like Lockheed. With a Beta of 0.44, it moves way less than the broader market. It’s a "sleep at night" stock for people who don't want to see 10% swings in a single day.
What most people get wrong about RTX
A common mistake is thinking RTX is just a "war stock." While they definitely benefit from defense spending, nearly 60% of their exposure is actually commercial. They are as much a "travel stock" as they are a "defense stock."
Another misconception? That the engine issues are over. They aren't. While the company is managing the financial hit, the supply chain for aerospace parts is still incredibly fragile. Lead times for some specialized materials are still 2 to 3 times longer than they were before the pandemic. If another technical glitch pops up, the stock could easily take a 5-10% haircut.
How to play RTX stock in 2026
If you’re thinking about jumping in, here’s the reality: the stock isn't cheap anymore. It’s trading at a Forward P/E of around 30, which is a bit of a premium compared to its historical average.
Watch the "Book-to-Bill" ratio. This is a nerdy stat that tells you how many orders are coming in versus how many are going out. Right now, it’s around 1.22 for their defense side. That means for every $1 of stuff they ship, they’re getting $1.22 in new orders. As long as that number stays above 1.0, the "moat" is growing.
Actionable Steps for Investors
- Check your exposure: Look at your existing ETFs (like ITA or XAR). You might already have 5-10% of your portfolio in this stock without realizing it.
- Monitor the 2027 Budget: The proposed $1.5 trillion defense budget is the main catalyst. If Congress pushes back or trims it significantly, expect the stock to cool off.
- Wait for the "Earnings Dip": RTX has a habit of reporting strong numbers but giving cautious guidance because of the engine repairs. These "dips" have historically been decent entry points for long-term holders.
- Set a Price Target: Analysts are split. Some, like Citigroup, see it hitting $227. Others are more cautious, with a mean target around $193. If you're buying at $202, you're betting on the high-end estimates.
The bottom line? RTX is a massive, complex machine that is currently benefiting from a world that is both traveling more and arming itself more. It's a defensive play in more ways than one.