Should You Ignore RTX and Buy This Magnificent Aerospace Stock Instead?

RTX (NYSE: RTX) is a fine and worthy stock that offers investors a balanced exposure to commercial aerospace and defense industries. That said, the stock has had a great run (up 47.5%) as the company has derisked itself after the discovery of manufacturing problems with the geared turbofan (GTF) engines that its Pratt & Whitney unit makes for the Airbus A320neo. It has been making good progress on removing, inspecting, and, where needed, replacing parts on those engines. As such, much of RTX's potential good news is already baked into its stock price. That's one reason why looking at advanced materials company Hexcel (NYSE: HXL) might make more sense for its more significant upside potential.RTX has had an excellent year due to its commercial aerospace operations. The GTF inspections are progressing as expected, and alongside the rest of the aerospace industry, RTX's commercial aerospace aftermarket sales have outperformed expectations. On the other hand, management lowered its full-year free-cash-flow (FCF) guidance mainly due to legal matters relating to its defense business and charges to terminate a fixed-price development defense program.The issues highlight margin challenges that many defense contractors have had, notably over fixed-price programs. Boeing and Lockheed Martin have had similar issues, so it's probably not a coincidence.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool