Morgan Stanley Analyst Lowers Price Target for Rtx Amidst GTF-Engine Uncertainty

Morgan Stanley's Kristine Liwag lowered their price target on Rtx (NYSE: RTX) by 12.6% from $95 to $83 on 2023/09/25. The analyst maintained their Hold rating on the stock.

Liwag contextualized their price target cut by saying that "Morgan Stanley remains cautious on GTF-engine related uncertainty regarding the ultimate cost and timeline of the powder metal fix. Rtx provided an initial estimate of a $6B to $7B cost. However, the analyst cautioned that Morgan Stanley believes it may be 2H 2024 before enough inspections have taken place for investors to reach consensus on the timing and magnitude of the actual total costs."

This recent development by Morgan Stanley has caused some concern among investors. However, it is worth noting that the analyst rating landscape for RTX is quite diverse. Currently, 57.1% of top-rated analysts rate RTX as a Strong Buy or Buy, while 42.9% see it as a Hold. Interestingly, no analysts recommend or strongly recommend selling the stock.

Looking ahead, analysts have a consensus forecast for RTX's upcoming year, predicting earnings per share (EPS) of $5.65. If these predictions come to fruition, RTX's next yearly EPS will see a significant increase of 48.7% on a year-over-year basis.

Unfortunately, RTX's stock price has experienced a decline since its last quarterly report on June 30, 2023. The stock is currently down 26.9% and down 14.2% year-over-year. These figures indicate that RTX is trailing behind the broader S&P 500 index, which itself has experienced a 15.4% decrease during the same period.

Kristine Liwag, the Morgan Stanley analyst responsible for the recent price target cut, is ranked by WallStreetZen in the top 18% out of 4,337 Wall Street analysts. Liwag has an average return of 3% and an impressive win rate of 52.8%. Their expertise lies in the Consumer Cyclical, Industrials, and Technology sectors.

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