Quantcast

Raytheon (RTN) Beats on Q2 Earnings, Raises '18 Guidance


Shutterstock photo

Raytheon Company RTN reported second-quarter 2018 adjusted earnings per share (EPS) from continuing operations of $2.45, beating the Zacks Consensus Estimate of $2.32 by 5.6%. The figure also improved 23.7% from $1.98 in the year-ago quarter.

Excluding the one-time tax benefit of 33 cents, the company reported GAAP earnings of $2.78 from continuing operations, up 47.1% year over year.

Operational Performance

The company's second-quarter revenues of $6,625 million saw 5.5% year-over-year growth. The reported number also surpassed the Zacks Consensus Estimate of $6,499 million by 1.9%.

Raytheon's bookings in the second quarter were $8,694 million compared with $6,532 million in the year-ago quarter, reflecting a surge of 33.1%. Total backlog at the end of the quarter was $39.9 billion, up 10.3% from the previous year's figure.

Total operating expenses increased 5.7% to $5,525 million. The company's operating income of $1,100 million rose 4.3% from $1,055 million a year ago.

Segment Performance

Integrated Defense Systems : The segment's revenues grew 3.6% year over year to $1,514 million, driven by higher net sales from an international Patriot program awarded in the prior quarter. Operating income
increased to $262 million from $245 million.

Intelligence, Information and Services : The segment's revenues of $1,687 million were higher than the year-ago level of $1,555 million by 8%. Operating income in the reported quarter also improved to $128 million
from $115 million a year ago.

Missile Systems : Revenues for the segment grew 7.9% to $2,051 million from $1,901 million a year ago, driven by higher net sales on classified programs. Operating income dropped to $231 million from $236 million
posted a year ago.

Space and Airborne Systems : Revenues in the second quarter stood at $1,605 million that witnessed a marginal dip of $3 million from the year-ago quarter. Operating income fell 6% to $206 million, primarily due to a change in program mix and other performance.

Forcepoint : This commercial cyber-security segment generated net sales of $148 million in the second quarter, up from $138 million a year ago. However, the joint-venture entity registered operating loss of $8 million in the reported quarter compared to the $2 million operating income generated in the previous year's quarter.

Raytheon Company Price, Consensus and EPS Surprise

Raytheon Company Price, Consensus and EPS Surprise | Raytheon Company Quote

Financial Update

Raytheon ended the second quarter with cash and cash equivalents of $3,094 million, down from $3,103 million as of Dec 31, 2017. Long-term debt was $4,752 million, up from an outstanding debt of $4,750 million as of Dec 31, 2017.

Operating cash flow from operating activities was $1.44 billion in the quarter compared with $741 million in the year-ago quarter.

In the reported quarter, Raytheon repurchased 1.9 million shares of common stock for $400 million.

2018 Guidance  

Raytheon has raised its full-year guidance for the top and bottom line. The company currently expects 2018 revenues in the range of $26.7-$27.2 billion, up from the prior guidance range of $26.5-$27 billion. It now expects
earnings from continuing operations of around $9.77-$9.97 per share, up from the $9.70-$9.90 band.

Raytheon also raised projections for its 2018 operating cash flow from continuing operations from the range of $2.6-$3 billion to $3.6-$4.0 billion.

Zacks Rank

Raytheon currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

Recent Defense Releases

Lockheed Martin LMT reported second-quarter 2018 adjusted earnings of $4.31 per share, beating the Zacks Consensus Estimate of $3.89 by 10.8%.

Textron TXT reported second-quarter 2018 earnings from continuing operations of 87 cents per share, which surpassed the Zacks Consensus Estimate of 70 cents by 24.3%.

Hexcel Corporation HXL reported second-quarter 2018 adjusted earnings of 75 cents per share, which missed the Zacks Consensus Estimate of 76 cents by 1.3%. However, the bottom line improved 11.9% from the
prior-year figure of 67 cents.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Lockheed Martin Corporation (LMT): Free Stock Analysis Report

Hexcel Corporation (HXL): Free Stock Analysis Report

Textron Inc. (TXT): Free Stock Analysis Report

Raytheon Company (RTN): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: LMT , HXL , TXT , RTN



More from Zacks.com

Subscribe






Zacks.com
Contributor:

Zacks.com

Equity Research










Research Brokers before you trade

Want to trade FX?