RTX Corp (RTX) Financial Statements

RTX's financial quality shows significant strengths and weaknesses when assessed against the GoodMoat framework. The company demonstrates adequate revenue growth of 12.1% YoY, which is positive but not at the high double-digit, accelerating pace the framework associates with strong growth trajectories. The primary concern lies in profitability and cash flow metrics. An operating margin of 10.0% and a profit margin of 7.6% are low, especially for a value investor seeking high-return businesses; they fall well short of the high gross and operating margins typically seen in companies with durable moats. The free cash flow yield of 3.0% is also unfavourable, as it translates to a high P/FCF multiple and is below the framework's >10-15% FCF margin target, indicating weak cash conversion. The balance sheet is a relative strength, with a Debt/Equity ratio of 0.61 suggesting a manageable leverage level, likely below the 1.0x Debt/EBITDA caution threshold. However, the ROE of 10.3% is below the framework's high-quality benchmark of 15-20%, indicating middling returns on shareholder capital. Overall, the profile is one of a large, stable industrial with moderate growth but sub-par profitability and cash generation quality for a high-conviction value investment. Analysis based on data as of 2024-05-15.