Raytheon (RTX-N)

Aerospace division challenged, as BA and Airbus are having a difficult time delivering planes. On the flipside, current planes have to stay in service longer and need replacement parts, so RTX has benefited. Selloff on engineering problems proved to be overdone.

He sold it because of problems with one of their engines. That was a mistake. They solved that issue and demand for defence remains. A good company.

Trades at 22x PE, but is not expensive and pays a 2% dividend yield. Pare back only if it's a large holding, or hold.

Trades at 22x PE, but is not expensive and pays a 2% dividend yield. Pare back only if it's a large holding, or hold.

Aerospace will benefit from global travel over the long term. Appears on-schedule to absorb the charges required to replace faulty engine components. Valuation catchup once this issue is behind them. After-market stream of revenue for servicing parts is very profitable. Yield is 2.46%.

With all the geopolitical uncertainty, the defense side should see strong growth. Order backlog is at historical highs.

Solid. It's pure defence and aerospace (i.e. jet engines), a good combination. Good valuation. They hit a problem with contaminants in engine parts about 18 months ago, which cost them, but the street has since regained confidence in them. He bought more shares around $85, which has paid off.

Is holding, but not buying more. They're in a nice spot straddling the defence and aerospace businesses. It's a defensive business model. The aviation business is booming now.

Likes it, because it has an aerospace business in addition to defence, which is a hedge. The street lost faith in RTX when contaminants got into some of the engines they were building. Shares declined, but this has become a buying opportunity; he bought in the mid-$80s. Negative sentiment eventually fades.

Took a large write down and hit to reputation due to metal contamination in engines. Most of the issue has been corrected. As you correct problems, the market starts to forgive. Not too late to get in. Reasonable valuation, sound business, aerospace side has lots of runway.

Note that this timeframe is short, since last October. His usual holding period is for at least 3-5 years. It was his Top Pick because it ran into some problems, stock sold off, giving him a bigger margin of safety. Stock's bounced back, happy to hold.

The delivered a great quarter, but their CEO is departing. They solved their gear turbo fan problem. Great balance sheet. The best defence stock.

It reports Tuesday. It has rebounded well from bottoming after issuing a recall. Shares could stall here, unless they announce something big. A good stock.

Large defensive budgets will increase profits for company. Global tensions will create demand for products. Good time to invest in company. 

Aviation and aerospace market in high demand with Global tensions. Large backlog of airplane demand will perform over time. Manufacturing defect in 2023 put large damper on company (large expense) which drove the stock down. Will continue to own shares. Problems appear to be in the rear view mirror. 

Bit out of favour and down in dumps. Even mix between aerospace and defense, both have massive demand and quite strong topline growth, good profitability. Engine issue has been an overhang. Cashflow hasn't yet been hit, as added service costs will come over next 2-3 years. Accelerated share buyback plan. Inexpensive multiple of 16.5x for such a strong business. Headline risk in the aviation space. Yield is 2.6%.

Feeds into today's theme of a company that can go against the grain, has a rock-solid balance sheet, and can operate in a counter-cyclical manner.