RTX (RTX) Could Be 10% Undervalued After British Army Training Contract

RTX (RTX) is back in focus after Raytheon UK led the Omnia Training consortium to secure a £2,000 million, 15-year British Army collective training contract, raising fresh questions about how this long-term defence work figures into the stock.

Contract Details

The contract, awarded by the UK Ministry of Defence, aims to provide collective training for the British Army. The Omnia Training consortium, led by Raytheon UK, will execute the training program over 15 years.

Stock Performance

RTX shares are trading at US$194.44, with a 30-day share price return of 4.76% and year-to-date return of 3.84%. The 1-year total shareholder return is 30.34%, and the 5-year return is 152.54%.

Valuation

According to Simply Wall St analysis, RTX could be 10% undervalued based on discounted cash flow. This valuation does not yet incorporate the new contract, which could further increase fair value.

What This Means for Investors

The contract strengthens RTX's position in the defence sector and provides long-term revenue visibility. However, investors should note that valuations are based on assumptions, and the stock has already appreciated significantly over the past year.