Summary
RTX moved higher in pre-market trading after two key developments: a $515 million follow-on contract awarded to Raytheon from the U.S. Navy for the SPY-6 family of maritime radars, and a Jefferies upgrade of the company’s stock from Hold to Buy with an increased price target. Together these items underpinned buying interest in the shares even as major U.S. indexes traded lower.
Contract details and operational implications
The $515 million award, announced on June 3, goes to Raytheon’s defense unit and covers work on the SPY-6 family of radar systems. The follow-on contract specifically includes upgrades to Flight IIA destroyers to install the SPY-6(V)4 variant and also extends support to Germany through the U.S. Foreign Military Sales program. The company characterized the award as reinforcing Raytheon’s role as the Navy’s principal supplier of advanced maritime radar technology and as a signal of continued production ramp-up, with plans to double output by 2028.
Analyst revision and financial assumptions
Jefferies raised its recommendation on RTX from Hold to Buy and lifted the price target to $220 from $210. The firm applied an 18.5x 2027 EBITDA multiple and a 3.6% free cash flow yield in setting the new target. Jefferies also increased its EPS forecasts for 2026 through 2028 by roughly 5% on average. The analyst firm cited several internal drivers for the revisions: margin expansion potential at Collins Aerospace driven by operational-excellence initiatives, improved original equipment pricing at Pratt & Whitney, and increasing aftermarket returns associated with the GTF engine program.
Market performance and context
RTX rose 2.0% in pre-open trading and was trading toward the upper portion of its intraday range of $172.55 to $176.42. The move helped the stock recover some ground, though it remained below its 52-week high of $214.50. The share strength came as the broader U.S. market was weaker on the session: the S&P 500 traded down about 0.7%, the Dow Jones was off roughly 1.2%, and the NASDAQ declined approximately 0.9%.
Takeaway
The combination of a sizable Navy radar contract and a more constructive analyst stance provided a near-term catalyst for RTX, allowing it to outperform the wider market during a down session. The award reinforces Raytheon’s standing in naval radar systems and aligns with stated production expansion plans, while the Jefferies note reflects updated financial assumptions and margin-related upside across select aerospace segments.