Buffett Brain · Research note
Score updated 29 Oct 2026 · analysis from 2 Jun 2026
RTX· Industrials
RTX
RTX is a fine aerospace and defense franchise priced like a wonderful one at 33 times earnings.
Buffett fit
Partial fit
Owner
10
Durability
72
Management
93
Price
14
Score updated 29 Oct 2026 · analysis from 2 Jun 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Industrials stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned all of RTX, I would admire the installed base and the multi-decade service revenue, and I would worry about how little of each sales dollar reaches me.
The full reasoning comes with a free account.
The durability here is real, and the 72 score reflects it. Airplanes fly for thirty years and someone has to service the engines, missiles get replenished, and governments do not stop buying radar.
The full reasoning comes with a free account.
Here management earns its 93. They have shrunk the share count at a 2.8 percent annual clip, grown earnings per share at 18.2 percent, and turned every dollar of net income into 1.18 dollars of .
The full reasoning comes with a free account.
There is no at this price, and that is the whole story.
The full reasoning comes with a free account.
Free account
Read the full RTX analysis free
- The full reasoning behind all four pillars
- Graham, Lynch and Greenblatt on the same stock
3 full analyses a week · no card needed
For and against
The strongest points on each side, with the numbers behind them.
In its favor
6- 1Management has compounded earnings per share at 18.2 percent while reducing the share count 2.8 percent a year, a rare combination that earns the 93 management score.
- 2 runs at 1.18 times net income, so the reported earnings are backed by real cash.
- 3Demand durability scores 72 because the installed base of engines and the replenishment of missiles generate decades of service and aftermarket revenue.
- 4Revenue has compounded at 8.3 percent, healthy growth for an enterprise of this scale.
Concerns
6- 1The valuation is the disqualifier: a 33.2 ratio and a 3.3 percent owner-earnings yield leave no , which is why the valuation score is 14.
- 2Return on capital is only 6.6 percent trailing and 4.5 percent over five years, far too thin for the price being asked, and the reason the score is just 10.
- 3 of 10.4 percent and of 20.2 percent show a capital-heavy, competitive business with limited .
- 4Net debt sits at 2.3 times EBITDA, so the balance sheet carries real with a current ratio of only 1.02.
Price history
$196+120.4%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
RTX builds jet engines through Pratt and Whitney, missiles and radars through Raytheon, and avionics and cabins through Collins Aerospace, then earns for decades on the spare parts and service that keep all of it flying. The trouble is that for all the long tails, it converts only a 20.2 percent and a 10.4 percent into cash, which tells you the manufacturing is capital-heavy and competitive. Revenue has compounded at a respectable 8.3 percent, but margins this thin are not the mark of a business that controls its own pricing.
How this analysis has moved
The call has held across 6 reviews.
Sep 27, 2026 → Oct 29, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Industrials
Free weekly email
Liked the read on RTX? Get the next ones on Monday.
Every Monday: the stocks most of the seven investors newly agree on. One email, unsubscribe any time.
Research, not investment advice.
See the Buffett analysis of RTX
The score, the checklist and the full reasoning open with a free account. You get 3 full analyses a week, and this stock is the first one. No card needed.
Create a free account3 full analyses a week · no card needed
Already have an account? Sign in