Raytheon Technologies (RTX) Stock Forecast & Price Target

RTX is supported by a highly diversified aerospace-and-defense portfolio that is showing strong operating momentum across all three segments, with 2Q26 sales up 14% and 16% organically, adj. EPS of $1.89, and total backlog reaching $289B, up 22% YoY. The company’s outlook is strengthened by broad demand in commercial aerospace and defense, leadership positions in missiles, missile defense, space, and cyber, and improving sentiment around Raytheon as defense growth and the commercial aftermarket both continue to accelerate. While Pratt & Whitney’s GTF execution and supply chain issues, along with tariff headwinds, remain notable risks, management still raised 2026 sales, adj. EPS, and FCF guidance, signaling confidence in expanding free cash flow, improving mix, and sustained margin expansion.

RTX is vulnerable to a slower-than-expected recovery in commercial aerospace, because weaker air traffic normalization and a softer aftermarket would pressure Collins Aerospace and Pratt & Whitney just as the company still depends on broad demand recovery to support earnings and cash flow. The outlook is also weighed down by the risk of delayed defense awards domestically and internationally, which could slow growth in Raytheon’s missile, sensor, and communications franchises despite ongoing U.S. DoD investments in advanced capabilities. With the downside case assuming only about $10.2B in free cash flow and a 20.2x multiple, the stock’s fundamentals appear exposed to execution and cycle risk, while the integration of UTX and RTN and the GTF engine learning curve add further uncertainty to margin and market share progress.