The shares of US aerospace and defense conglomerate Raytheon Technologies Corp. strengthened for the fourth week in a row on the back of positive financial statements and the prospect of new orders from the US Department of Defense.
Last week, the company reported higher-than-expected third-quarter earnings, driven by higher aircraft engines and parts sales. However, full-year earnings forecasts were slightly reduced due to ongoing supply chain problems and a shortage of qualified staff. The corporation's revenue in the third quarter amounted to 16.95B dollars, which is 5% more than last year's 16.21B dollars. Adjusted earnings per share came in at 1.21, down from last year's 1.26 dollars but above the median forecast of 1.11 dollars. According to management's forecasts, annual sales will be 67.15–67.30B dollars, which is less than the previously expected 67.75–68.75B dollars. Earnings per share are now expected to be 4.60–4.80 dollars instead of 4.70–4.80 dollars.
Despite a certain decrease in forecasts, the issuer's shares are developing positive dynamics against the background of the escalation of the military conflict on the territory of Ukraine, which may result in new deliveries of American weapons. Recently, Washington has been considering the issue of providing Kyiv with additional air defense systems, which Raytheon Technologies Corp is developing. It is already known that the company is working on producing several NASAMS anti-aircraft systems. Continued intense fighting will boost order volume and corporate profits, keeping investors interested in the stock.
Technical indicators confirm the upward trend: Bollinger Bands and Stochastic are reversing upwards, while MACD is increasing in the positive zone.
The quote's growth targets maybe 96.88 (Murrey [+2/8]), 99.00, and 100.40 (area of five-month highs). The price going beyond the upper Bollinger band does not rule out a corrective decline to the area of 92.19 (Murrey [7/8]), 90.62 (Murrey [6/8]), but it is unlikely to lead to a reversal of the current trend.
Resistance levels: 95.31, 96.88, 99.00, 100.40. | Support levels: 92.19, 90.62.