Raytheon Co

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RTN : NYSE : Industrial Goods
$136.13 -0.41 | -0.30%
Today's Range: 134.44 - 137.17
Avg. Daily Volume: 1,555,900
09/30/16 - 4:02 PM ET

Financial Analysis


RAYTHEON CO's gross profit margin for the second quarter of its fiscal year 2016 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 2.58% from the same quarter last year.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)6035.05848.0
EBITDA ($mil)925.0792.0
EBIT ($mil)802.0676.0
Net Income ($mil)709.0505.0


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)2719.02494.0
Total Assets ($mil)29098.028437.0
Total Debt ($mil)5333.05333.0
Equity ($mil)10316.010056.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin26.8424.61
EBITDA Margin15.3213.54
Operating Margin13.2911.56
Sales Turnover0.820.8
Return on Assets7.47.57
Return on Equity20.7821.34
Debt Q2 FY16 Q2 FY15
Current Ratio1.641.54
Debt/Capital0.340.35
Interest Expense58.059.0
Interest Coverage13.8311.46


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)295.1304.0
Div / share0.730.67
EPS2.381.65
Book value / share34.9633.08
Institutional Own % n/a n/a
Avg Daily Volume1700498.01883123.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 24.95 for the Aerospace & Defense industry and a discount compared to the S&P 500 average of 25.19. Conducting a second comparison, its price-to-book ratio of 3.99 indicates a premium versus the S&P 500 average of 2.82 and a significant discount versus the industry average of 31.11. 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 19.56 Peers 24.95   RTN 13.81 Peers 15.47

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

RTN is trading at a discount to its peers.

 

Discount. 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 discount 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 18.00 Peers 19.48   RTN 2.02 Peers 3.31

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.

 

Discount. 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 significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
RTN 3.99 Peers 31.11   RTN 2.73 Peers 203.59

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 1.72 Peers 1.55   RTN 5.08 Peers 4.07

Premium. 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 premium to 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 exceeds its peers.

 

 

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