Raytheon (RTN) Remains a Top Pick for RBC Capital Following a 4Q EPS Beat

RBC Capital maintained a Top Pick rating on Raytheon (NYSE: RTN), and cut the price target to $147.00 (from $149.00), following the company's 4Q earnings report. Raytheon reported EPS of $1.85, ahead of consensus of $1.80. Management tackled concerns regarding the impact of the oil price collapse on defense export demand. Having just visited the Middle East, the CEO noted no sign of demand easing. Initial guidance for 2016 is encouraging, with Raytheon projecting ~4% revenue growth, up from the forecast in October, boosted by strong 4Q15 bookings.

Analyst Robert Stallard commented, "Raytheon reported EPS of $1.85, ahead of consensus of $1.80. Revenues of $6.35bn (+2% YoY) topped our forecast for the quarter, with good performance from IDS, SAS, and Force Point (fka Websense) offsetting IIS and MS. The divisional operating margins saw some puts and takes, with a notably strong 14.7% margin in SAS and MS helping to offset higher than expected non-operating corporate costs. Similar to its peers, Raytheon was also helped by a lower than expected tax rate in 4Q of 28.4%."

For an analyst ratings summary and ratings history on Raytheon click here. For more ratings news on Raytheon click here.

Shares of Raytheon closed at $122.18 yesterday.

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