RTX Corp's Dividend Analysis
In This Article:
Understanding the Dividend Dynamics of RTX Corp
RTX Corp (NYSE:RTX) recently announced a dividend of $0.59 per share, payable on 2023-12-14, with the ex-dividend date set for 2023-11-16. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's delve into RTX Corp's dividend performance and assess its sustainability.
What Does RTX Corp Do?
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RTX Corp (NYSE:RTX) is a diversified aerospace and defense industrial company formed from the merger of United Technologies and Raytheon. It has a balanced exposure as a supplier to both commercial aerospace manufacturers and the defense market. RTX Corp operates through three main segments: Collins Aerospace, Pratt & Whitney, and Raytheon, offering a wide range of products from aerospace systems to military hardware and technology.
A Glimpse at RTX Corp's Dividend History
RTX Corp has a strong track record of maintaining consistent dividend payments since 1985, with distributions occurring quarterly. This history reflects the company's commitment to providing regular returns to its shareholders.
Below is a chart showing the annual Dividends Per Share that helps track historical trends.
Breaking Down RTX Corp's Dividend Yield and Growth
At present, RTX Corp boasts a 12-month trailing dividend yield of 2.85% and a 12-month forward dividend yield of 2.95%, indicating anticipated dividend increases in the coming year.
Over the past three years, RTX Corp's annual dividend growth rate was -9.80%, which improved to -6.90% per annum over a five-year period.
Based on RTX Corp's dividend yield and five-year growth rate, the 5-year yield on cost of RTX Corp stock as of today is approximately 1.99%.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is a critical metric for assessing dividend sustainability. It indicates the proportion of earnings allocated to dividends. RTX Corp's dividend payout ratio as of 2023-09-30 is 1.05, which may raise concerns about the sustainability of its dividends.
Additionally, RTX Corp's profitability rank is 6 out of 10, reflecting fair profitability and a consistent track record of net profits over the past decade.
Growth Metrics: The Future Outlook
For dividends to be sustainable, a company must exhibit strong growth metrics. RTX Corp's growth rank of 6 out of 10 suggests a fair growth outlook.