Raytheon At Cutting Edge Of Defense Work
Raytheon ( RTN ), founded in 1922 in the shadow of the Massachusetts Institute of Technology, has been in the forefront of technology, especially defense technology, from its beginning.
It invented the technology that made radio a mass product. It produced radar that helped win World War II.
Among its latest products is the Zumwalt-class destroyer, a stealthy -- that means it's hard to see on radar -- ship that can fire missiles.
Though the Zumwalt program has had problems and has been scaled back, it shows Raytheon's devotion to the most advanced defense systems.
Each destroyer is 600 feet long, cruises at 30 knots and costs $3.45 billion each, $7 billion if R&D is figured in.
Raytheon is in a wide spectrum of defense activities, ranging from cybersecurity and intelligence to space and missile systems.
It recently delivered its 3,000th Tomahawk Block IV cruise missile to the U.S. Navy.
The Aerospace/Defense industry group is ranked No. 10 out of 197 industry groups tracked by IBD. That's up from No. 30 just eight weeks ago.
Earnings growth has slowed, but is remarkably stable. The three-year earnings stability factor is 2 on a scale of zero (most stable) to 99 (most volatile).
In the last report, EPS dropped 1% to $1.60 a share. Analysts are forecasting a 16% decline in the next report. They expect a 7% decline in 2013, but an 8% increase in 2014.
The company pays a $2.20 annual dividend, which translates to a 2.4% yield. The three- to five-year dividend growth rate is an impressive 23%.
After moving sideways for years since 2010, the stock broke out of a base last April and now trades above its 10-week moving average.