Citi upgrades RTX, Northrop Grumman to ‘buy’ on growth, valuation

Investing.com — Citi upgraded Rtx Corp (NYSE:RTX) to “Buy” from “Neutral,” raising its price target to $153 from $132, driven by improved revenue, cash flow outlook, and progress on the GTF engine issues.

Analysts highlighted rising original equipment or OE production rates, robust defense backlogs, and aftermarket growth driven by higher aircraft deliveries and refurbishment demand. RTX’s free cash flow could reach $10 billion by 2027, normalizing after recent one-time costs.

Citi also upgraded Northrop Grumman Corporation (NYSE:NOC) to “Buy” following a 15% stock sell-off since November. The brokerage sees valuation compelling, with strong visibility from Northrop’s key role in modernizing U.S. nuclear deterrence and potential benefits from government efficiency efforts that may shift work to contractors.

Citi maintained its price target at $587, citing better-than-feared defense budgets under the new administration.