Raytheon Technologies vs Northrop Grumman Which Is More Lucrative?

Raytheon Technologies and Northrop Grumman are two major players in the aerospace and defense industry, both boasting impressive portfolios of products and services. When comparing their stocks, investors may consider factors such as market performance, financial stability, and growth prospects. Raytheon Technologies has a diverse range of offerings, while Northrop Grumman is known for its advanced technology solutions. Understanding the strengths and weaknesses of each company can help investors make informed decisions about their stock investments in the aerospace and defense sector.

Raytheon Technologies or Northrop Grumman?

When comparing Raytheon Technologies and Northrop Grumman, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Raytheon Technologies and Northrop Grumman.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Raytheon Technologies has a dividend yield of 2.14%, while Northrop Grumman has a dividend yield of 1.67%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Raytheon Technologies reports a 5-year dividend growth of -3.93% year and a payout ratio of 67.44%. On the other hand, Northrop Grumman reports a 5-year dividend growth of 9.33% year and a payout ratio of 49.22%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Raytheon Technologies P/E ratio at 32.79 and Northrop Grumman's P/E ratio at 29.64. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Raytheon Technologies P/B ratio is 2.53 while Northrop Grumman's P/B ratio is 4.77.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Raytheon Technologies has seen a 5-year revenue growth of -0.42%, while Northrop Grumman's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Raytheon Technologies's ROE at 7.85% and Northrop Grumman's ROE at 16.36%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $115.62 for Raytheon Technologies and $473.77 for Northrop Grumman. Over the past year, Raytheon Technologies's prices ranged from $79.67 to $128.70, with a yearly change of 61.54%. Northrop Grumman's prices fluctuated between $418.60 and $555.57, with a yearly change of 32.72%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.