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Scoreboard Pick of the Week - $RTX
Each week I do a review of a stock I purchase or one that is at the top of my Scorecard. I did not make any adds this week, so I will be reviewing Raytheon Technologies, $RTX. I currently hold $RTX in my Taxable Portfolio.
Raytheon is an aerospace and defense conglomerate. Raytheon Technologies researches, develops, and manufactures advanced technology products in the aerospace and defense industry, including aircraft engines, avionics, aerostructures, cybersecurity, guided missiles, air defense systems, satellites, and drones. The company is also a large military contractor, getting a significant portion of its revenue from the U.S. government - Wikipedia
Raytheon Technologies was formed by the merger of Raytheon Company and United Technologies in 2020.
Since the merger in 2020, revenues have increased but profits have waffled.
Revenue:
2020 - $56.59B
2021 - $64.39B
Earnings:
2020 - ($3.52B)
2021 - $3.86B
Dividend:
2020 - $1.90
2021 - $2.04 (+7.4%)
Some history on my $RTX position:
- Initial Purchase Date - 5/8/2020
- Average Cost Basis - $59.24
- Current Unit Price - $100.98
- Price Appreciation (vs S&P) - +72.12% (+18.51%)
- EPS - $2.58
- P/E - 39.48
- Annual Dividend - $2.04
- Dividend Yield - 2.02%
- Yield on Cost - 3.44%
- Portfolio Weighting - 0.58% (1.25% target)
- Scoreboard Scorecard Rating - 4/5
So how does $RTX achieve the 4/5 on my Scorecard?
- Stock Price Appreciation (+1)
- Having a dividend yield greater than my portfolio average (+0.5)
- Underweight versus holding target (+1)
- P/E under 50 (+0.5)
- Personal Conviction Score (+1) - Just updated last weekend
Raytheon has been a major player in the defense industry for many years. Now that the merger has settled and the business is starting to stabilize, I am excited to see how earnings continue to grow in the future. With the recent developments in Europe, I have increased my Conviction Score to High - in anticipation of larger scale developments. This change bumped $RTX up from a mid range 3.5 on my Scorecard to a highly rated 4.
Do you hold $RTX? If not, what is your favorite Defense stock?
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