RTX Corporation (RTX +2.06%)… the name itself feels like a coded transmission from the Pentagon. This morning, they dropped their 2025 earnings, and the market, predictably, twitched. A 2.1% pop by 9:45 AM ET. Not a supernova, more like a controlled demolition. A flicker of green in a world rapidly turning shades of grey. The war machine doesn’t exactly boom anymore, it… accrues.
The analysts, those pale, caffeine-addicted seers, were whispering about $1.47 a share on $22.7 billion in sales. RTX delivered $1.55, adjusted for whatever accounting voodoo they’re practicing these days, on $24.2 billion. A little over, a little better. But better isn’t enough. Not in this climate. It’s like offering a band-aid to a man bleeding out on the battlefield. It feels… insufficient.
The Numbers Game
Twelve percent sales climb year over year in Q4. Sounds good on paper. Non-GAAP earnings only crawled up 1%, but GAAP earnings jumped 8%. The accounting gymnastics are enough to induce a migraine. It’s all smoke and mirrors, designed to obscure the fundamental truth: they’re selling weapons. And weapons sell. Always.
Full-year sales: $88.6 billion, a 10% increase. Q4 accelerated things, apparently. GAAP earnings for the year hit $4.96 a share – a 40% jump. Good numbers. But the real story, the one they don’t want you to focus on, is the cash flow. That’s where the true power lies.
They generated $3.2 billion in cash in Q4 – a 549% leap. Let that sink in. 549%. And $7.9 billion for the year, up 75%. This isn’t about profits, it’s about liquidity. It’s about having the resources to build more, to expand, to… dominate. The gears are turning, and they’re greased with cold, hard cash.
The Outlook: More of the Same
CEO Chris Calio, a man who probably hasn’t seen the inside of a voting booth in decades, says they’re starting 2026 “with great momentum.” Momentum. That’s a convenient word, isn’t it? It implies unstoppable force, a relentless march forward. They’re projecting $92-93 billion in sales, about 4.4% growth. Adjusted earnings: $6.60-$6.80, roughly 6.5% growth. And free cash flow between $8.25 and $8.75 billion, or 7.6% growth. It’s all so… predictable. A meticulously crafted illusion of progress.
Modestly growing sales, amplified by improved profit margins. That’s the narrative. It’s a clean, efficient machine. But the valuation… 31 times free cash flow? That’s where it starts to feel… precarious. Like a house of cards built on a foundation of depleted uranium. The market is pricing in perfection, and perfection is a dangerous thing. Especially in this business.
Look, I’m not saying it’s a bad company. It’s a war profiteer. And war, unfortunately, is a remarkably consistent business. But at this price? It’s a SELL. A hard, cold, unequivocal SELL. Because sooner or later, the music stops. And when it does, you don’t want to be holding the bag.
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2026-01-27 18:42