RBC Capital has bumped its price target on RTX Corp. to $230.00 from $220.00 and reiterated an Outperform rating on the aerospace and defense firm. The revised target reflects the stocks recent momentum: share quotes show RTX trading at $201.28, roughly 0.99% below its 52-week high of $203.03.
The upgrade follows a strong fourth quarter of 2025 for RTX, when adjusted earnings per share arrived at $1.55 and total sales reached $24.2 billion, representing 14% organic year-over-year growth. For the trailing twelve months, RTX recorded revenue of $88.6 billion, growing 9.74%, and reported diluted earnings per share of $4.96.
Commercial markets were the principal contributor to the quarters strength, with commercial sales expanding by about 17%. RBCs commentary highlights that, while commercial momentum was notable, the outlook for defense sales will likely remain an important focus for investors going forward.
The company sits as a major player in Aerospace & Defense with a market capitalization of $269.87 billion, and its shares have delivered a price total return of 59.74% over the past year. On valuation and shareholder return metrics, the stock trades at a price-to-earnings ratio of 39.14 and yields a dividend of 1.35%. The company has paid dividends for 55 consecutive years and increased its payout for four straight years.
RBC also signaled that RTXs Geared Turbofan (GTF) fleet management program is tracking in line with company expectations. The firm said initial guidance for 2026 supports a constructive view of the name. In modeling revisions, RBC slightly adjusted its free cash flow forecasts to $8.5 billion for 2026 and $10.2 billion for 2027, while leaving its Outperform rating unchanged.
For context on cash generation, RTXs levered free cash flow over the last twelve months stood at $5.24 billion, which corresponds to a free cash flow yield of 3% on current market capitalisation measures.
Additional developments surrounding the quarterly report reinforced analyst confidence. RTX beat consensus expectations in the fourth quarter: EPS was $1.55 versus a forecast of $1.47, and revenue came in at $24.2 billion versus an anticipated $22.69 billion. Separately, Raytheon, a business unit within RTX, received a $193.7 million contract modification for guided missiles, with work scheduled for completion by September 2028.
Market reactions included fresh target increases from other research houses. Vertical Research Partners raised its target to $227 and maintained a Buy rating while voicing skepticism about what it termed conservative guidance for Pratt & Whitney. TD Cowen lifted its target to $225 and cited the strong fourth-quarter showing in support of the move.
Analytical takeaways
- RBCs target increase to $230 reflects continuing momentum in RTXs share price and an upbeat read on underlying results.
- Commercial aerospace demand was the key driver of the quarter, though defense sales remain a central investor focus.
- Several research firms raised price objectives after results, indicating broad analyst reassessment of near-term fundamentals.
Financial context and metrics
- Q4 2025 adjusted EPS: $1.55; Revenue: $24.2 billion (14% organic growth year-over-year).
- Trailing twelve-month revenue: $88.6 billion (9.74% growth); diluted EPS: $4.96.
- Market cap: $269.87 billion; 1-year price total return: 59.74%.
- P/E ratio: 39.14; Dividend yield: 1.35%; Dividend history: paid 55 consecutive years, increased payout for 4 consecutive years.
- Levered free cash flow (LTM): $5.24 billion; Free cash flow yield: 3%.
- RBC free cash flow estimates: $8.5 billion (2026), $10.2 billion (2027).
What to watch
Investors are likely to monitor the companys defense sales trajectory and how the GTF fleet management program unfolds relative to expectations, alongside the initial 2026 guidance that the firm cited as supportive. Analysts have already nudged valuation targets higher in response to the quarter, and cash flow revisions will be reviewed for implications on capital allocation and dividend policy.