January 28, 2025 15:21 GMT
CAPITAL GOODS: RTX (RTX Baa1[N]/BBB+[N]/NR): 4Q24 Results
CAPITAL GOODS
Credit neutral. Leverage is back down to 2022 levels again post M&A. It was linked to Boeing’s Jeppersen unit yesterday. Trump “Iron Dome” headlines are helping equity sentiment today.
- RTX reported revenue 5% ahead of consensus, with organic growth at 11% (c4.3%). Raytheon and Pratt & Whitney divisions were both strong. The order backlog continues to swell; book to bill reached 1.4x.
- Adj. EBITDA beat by 26%, on strong volumes, with aftermarket growth helping margins.
- FCF of $492mn missed expectations of $693mn, with capex and working capital changes larger than forecasts. Our adj. leverage fell to 2.6x from 3.3x at 3Q.
- FY25 revenue guidance is 1% below consensus, with FCF guidance in-line. Adj. EBIT guidance is segmented and appears slightly low overall.
- Webcast replay: https://edge.media-server.com/mmc/p/hhdrq9x6/.
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