Comparing RTX (NYSE:RTX) & Rheinmetall (OTCMKTS:RNMBY)

RTX (NYSE:RTX) and Rheinmetall (OTCMKTS:RNMBY) are both large-cap industrials companies, but which is the superior business? We will compare the two companies based on the strength of their risk, institutional ownership, earnings, profitability, dividends, valuation and analyst recommendations.

Dividends

RTX pays an annual dividend of $2.92 per share and has a dividend yield of 1.6%. Rheinmetall pays an annual dividend of $1.90 per share and has a dividend yield of 0.9%. RTX pays out 51.4% of its earnings in the form of a dividend. Rheinmetall pays out 65.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. RTX has raised its dividend for 5 consecutive years. RTX is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares RTX and Rheinmetall’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RTX	8.28%	13.99%	5.51%
Rheinmetall	6.45%	22.39%	6.94%

Institutional & Insider Ownership

86.5% of RTX shares are owned by institutional investors. 0.1% of RTX shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

RTX has a beta of 0.31, meaning that its stock price is 69% less volatile than the S&P 500. Comparatively, Rheinmetall has a beta of 0.18, meaning that its stock price is 82% less volatile than the S&P 500.

Valuation and Earnings

This table compares RTX and Rheinmetall”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RTX	$88.60 billion	2.84	$6.73 billion	$5.68	32.84
Rheinmetall	$11.24 billion	4.44	$787.45 million	$2.91	73.56

RTX has higher revenue and earnings than Rheinmetall. RTX is trading at a lower price-to-earnings ratio than Rheinmetall, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for RTX and Rheinmetall, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RTX	1	8	18	0	2.63
Rheinmetall	0	2	7	0	2.78

RTX presently has a consensus target price of $228.58, suggesting a potential upside of 22.53%. Given RTX’s higher probable upside, equities research analysts clearly believe RTX is more favorable than Rheinmetall.

Summary

RTX beats Rheinmetall on 12 of the 17 factors compared between the two stocks.

About RTX

RTX Corporation, an aerospace and defense company, provides systems and services for the commercial, military, and government customers in the United States and internationally. It operates through three segments: Collins Aerospace, Pratt & Whitney, and Raytheon. The Collins Aerospace Systems segment offers aerospace and defense products, and aftermarket service solutions for civil and military aircraft manufacturers and commercial airlines, as well as regional, business, and general aviation, defense, and commercial space operations. This segment also designs, produces, and supports cabin interior, including oxygen systems, food and beverage preparation, storage and galley systems, and lavatory and wastewater management systems; battlespace, test and training range systems, crew escape systems, and simulation and training solutions; information management services; and aftermarket services that include spare parts, overhaul and repair, engineering and technical support, training and fleet management solutions, and asset and information management services. Its Pratt & Whitney segment supplies aircraft engines for commercial, military, business jet, and general aviation customers; and produces, sells, and services military and commercial auxiliary power units. The Raytheon segment provides defensive and offensive threat detection, tracking, and mitigation capabilities for U.S., foreign government, and commercial customers. The company was formerly known as Raytheon Technologies Corporation and changed its name to RTX Corporation in July 2023. RTX Corporation was incorporated in 1934 and is headquartered in Arlington, Virginia.

About Rheinmetall

Rheinmetall AG provides mobility and security technologies worldwide. The company operates in five segments: Vehicle Systems, Weapon and Ammunition, Electronic Solutions, Sensors and Actuators, and Materials and Trade. The Vehicle Systems segment offers combat, logistics, support, and special vehicles, including armored tracked vehicles, CBRN protection systems, artillery, turret systems, and wheeled logistics and tactical vehicles. The Weapon and Ammunition segment provides firepower and protection solutions, such as weapons and munition, protection systems, propellants and international projects and services. The Electronic Solutions segment offers a chain of systems network, such as sensors, networking platforms, automated connected effectors for soldiers, and cyberspace protection solutions, and training and simulation solutions. Its products include air defense systems; soldier systems; command, control, and reconnaissance systems; fire control systems; sensors; and simulations for the army, air force, navy, and civil applications. The Sensors and Actuators segment provides a portfolio of products comprising exhaust gas recirculation systems; throttle valves, control dampers, and exhaust flaps for electromotors; solenoid valves; actuators and valve train systems; oil, water, and vacuum pumps for passenger cars, commercial vehicles, and light and heavy-duty off-road applications; and industrial solutions. The Materials and Trade segment develops system components for the basic motors, such as engine blocks, structural components, and cylinder heads; plain bearings, and bushes; and replacement parts. It also engages in the aftermarket activities. The company was formerly known as Rheinmetall Berlin AG and changed its name to Rheinmetall AG in 1996. Rheinmetall AG was founded in 1889 and is headquartered in Düsseldorf, Germany.