Raytheon Technologies (RTX) Stock Forecast & Price Target

RTX is benefiting from a balanced aerospace-and-defense portfolio that is firing across all three segments, with 2Q26 sales up 14% organically by 16% and EPS beating by 14%, while backlog reached $289B, up 22% YoY. Raytheon’s 18% organic growth, roughly $20B of awards, and 48% international backlog show strong defense demand, while Collins and Pratt & Whitney continue to add commercial aerospace upside despite GTF execution risk. Management’s raised 2026 sales, EPS, and FCF guidance, combined with disciplined capital allocation, debt reduction, and continued supply-chain investment, supports a durable growth and cash-generation thesis.

RTX is facing a weak fundamental setup because a slower-than-expected recovery in commercial aerospace and delayed defense awards could keep revenue growth muted while free cash flow remains nearer the implied ~$10.2B downside case. The company also continues to grapple with supply chain bottlenecks in rocket motors, microelectronics, engine castings, and forgings, and those pressures have already weighed on 2025 results and could persist through 2026, though to a lesser degree. On top of that, lower-than-expected synergies, incremental tariff headwinds, and GTF engine issues at Pratt & Whitney threaten margins, limiting operating leverage across its three core segments.