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Raytheon Co
RTN : NYSE : Industrial Goods
$126.35 | %
Today's Range: 125.32 - 127.50
Avg. Daily Volume: 1,998,800
04/29/16 - 4:01 PM ET

Financial Analysis


RAYTHEON CO's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.29% from the same quarter last year.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)5763.05288.0
EBITDA ($mil)736.0768.0
EBIT ($mil)612.0661.0
Net Income ($mil)429.0551.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)2645.04140.0
Total Assets ($mil)28829.027798.0
Total Debt ($mil)5332.05331.0
Equity ($mil)10124.09707.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin25.826.12
EBITDA Margin12.7714.52
Operating Margin10.6212.5
Sales Turnover0.820.81
Return on Assets6.777.91
Return on Equity19.1422.05
Debt Q1 FY16 Q1 FY15
Current Ratio1.631.82
Debt/Capital0.350.35
Interest Expense58.058.0
Interest Coverage10.5511.4


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)299.0305.9
Div / share0.671.28
EPS1.431.78
Book value / share33.8631.73
Institutional Own % n/a n/a
Avg Daily Volume2053018.01813428.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 20.90 for the Aerospace & Defense industry and a discount compared to the S&P 500 average of 23.99. Conducting a second comparison, its price-to-book ratio of 3.77 indicates a premium versus the S&P 500 average of 2.74 and a significant discount versus the industry average of 9.47. The current price-to-sales ratio is below the S&P 500 average, but above the industry average. Upon assessment of these and other key valuation criteria, RAYTHEON CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
RTN 19.92 Peers 20.90   RTN 14.49 Peers 15.50

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

RTN is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

RTN is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
RTN 15.94 Peers 18.03   RTN 4.20 Peers 4.57

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

RTN is trading at a valuation on par with its peers.

 

Average. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

RTN trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
RTN 3.77 Peers 9.47   RTN -6.98 Peers 4.95

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

RTN is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, RTN is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
RTN 1.61 Peers 1.59   RTN 4.93 Peers 1.10

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

RTN is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

RTN has a sales growth rate that significantly exceeds its peers.

 

 

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