Raytheon News
Raytheon enjoys a unique position in the aerospace and defense industry that allows it thrive even when the economy isn't doing well. Because of its large market share in commercial aerospace, Raytheon is well-insulated from the general population. US Defense priorities also depend on Raytheon's ability to perform rigorous, high-touch R&D quickly enough to be able compete with other great power nations.
For example, the defense industry is in a unique position to benefit from a transformational trend that is set to transform the way nations defend themselves against great-power conflict, and that has the potential to be a game changer for US military priorities and commercial aerospace demand. This kind of competitive moat is why I think you should look closely at a company like Raytheon in times of market turmoil.
Stocks could be boosted by President Biden's trip to Ukraine
The White House signed off on sending the Patriot missile system to embattled Kyiv, Ukraine, before Russia launched its brazen invasion of the country last month. Even though the battle in Ukraine has a symbolic meaning, future Raytheon defense clients can see that their products are effective at protecting their nation against attack.
That could be a good thing for Raytheon in the long run, especially because a successful deployment to Ukraine would mean a significant increase in defense spending by the nation-states that purchase its wares.
This could drive a rise in RTX stock values as nation states look to update their arsenals. This type of battlefield effectiveness is crucial in a world that nations seek to retool its armed forces and refocus on non-confrontational diplomacy and policing, as opposed to the type of combat that was fought over centuries by warring superpowers.
Drones are a significant new threat to air- and missile defense capabilities. This is another transformative shift. Drones are not only small, but they are also highly maneuverable. Drones are very difficult to detect, both by conventional air and missile-defense system as well as ground sensors.
Raytheon's drone-defense radars can be used to track these stealthy and difficult weapons of war. The V3 radar developed by Raytheon is part of Navy's Ford-class aircraft carrier. It will be activated later this summer.
It is also developing V2 and V3 versions for its SPY-6 radars, which will be fitted on future destroyers. Lockheed Martin is managing the integration of four SPY-6 radar faces with IAMD (Integrated Air and Missile Defense), systems.
This makes it one the most advanced and complex radars that the military has ever seen and is a crucial element of its overall effectiveness. Mills stated that Raytheon plans to install it on all the carriers being built by HII during the next five years, despite the obstacles.