RTX Corp. (NYSE:RTX)

Analysis of the valuation ratios from March 2022 through September 2026 reveals a period of initial contraction and volatility followed by a sustained increase in market premiums relative to sales and book value.

Price to Earnings (P/E) and Price to Operating Profit (P/OP)

Both ratios demonstrate a high degree of correlation, experiencing a downward trend from early 2022 until mid-2023, with P/E bottoming at 22.79 and P/OP at 20.81 in June 2023. A significant anomaly occurred in June 2024, characterized by a sharp spike to 66.73 for P/E and 52.96 for P/OP, indicating a temporary divergence between share price and earnings/operating profit. In the subsequent period from late 2024 through September 2026, these ratios stabilized, with P/E generally fluctuating between 31.05 and 39.61.

Price to Sales (P/S)

The P/S ratio remained relatively stable around the 2.0 level during 2022 before declining to a low of 1.68 in September 2023. From 2024 onward, a consistent upward trajectory is observed, with the ratio increasing to a peak of 3.01 in June 2025 and June 2026. This trend suggests that the market began assigning a higher value to each dollar of revenue generated over the latter half of the analyzed period.

Price to Book Value (P/BV)

The P/BV ratio exhibited the most pronounced growth trend. After reaching a trough of 1.62 in September 2023, the ratio entered a sustained climb, consistently increasing through 2024 and 2025. The ratio peaked at 4.25 in June 2026, marking a substantial expansion in the premium paid over the company's accounting book value compared to the levels observed in 2022.

The financial data indicates a period of significant growth in market valuation and fundamental earnings, characterized by an initial phase of volatility followed by a sustained upward trajectory. Between early 2022 and late 2026, there is a clear expansion in both the share price and earnings per share, although the relationship between the two fluctuated markedly during the mid-period.

Share Price Trends

The stock price exhibited relative stability between March 2022 and December 2023, trading primarily within a range of $78.38 to $101.09. A decisive bullish trend emerged in 2024, with the price rising from $101.38 in March to $129.92 by year-end. This growth accelerated through 2025 and early 2026, reaching a peak of $209.16 in June 2026 before settling at $193.34 in September 2026.

Earnings Per Share (EPS) Dynamics

Earnings experienced a period of instability between June 2023 and June 2024. After reaching a peak of $3.82 in June 2023, EPS declined sharply to $2.22 in September 2023 and reached a low of $1.70 in June 2024. Following this trough, a consistent recovery was observed, with EPS growing every quarter from September 2024 through September 2026, eventually reaching $6.23.

Price-to-Earnings (P/E) Ratio Analysis

The P/E ratio reflected the underlying volatility of earnings. In the first half of the period, the ratio trended downward from 35.16 to a low of 22.79 in June 2023. An anomalous spike to 66.73 occurred in June 2024, which was primarily driven by the contraction in EPS rather than a speculative price surge. For the remainder of the analyzed period, the P/E ratio stabilized, fluctuating within a normalized band between 31.05 and 39.61, suggesting that the market price aligned more closely with the recovered and growing earnings stream.

Overall, the data reveals a transition from a period of earnings instability and valuation compression to a phase of strong fundamental growth and price appreciation. The stabilization of the P/E ratio in the final years suggests a more sustainable valuation equilibrium as earnings growth began to pace the increase in share price.

The Price to Operating Profit (P/OP) ratio for the analyzed period demonstrates a pattern of initial stability, followed by a phase of high volatility, and concluding with a period of valuation normalization. While both share price and operating profit per share trended upward over the long term, the relationship between the two fluctuated significantly between 2023 and early 2024.

Share Price Dynamics

The share price exhibited a general upward trajectory, ascending from 99.19 USD in March 2022 to a peak of 209.16 USD in June 2026. A notable period of weakness occurred between June 2023 and December 2023, where prices reached a low of 78.38 USD before beginning a sustained recovery and growth phase through 2025 and 2026.

Operating Profit per Share Trends

Operating profit per share showed overall growth, starting at 3.38 USD in March 2022 and reaching 8.37 USD by September 2026. However, this growth was interrupted by two significant contractions: one in September 2023 (2.24 USD) and another in June 2024 (2.14 USD). Following the June 2024 trough, operating profit per share entered a consistent quarterly increase, more than tripling by the end of the period.

P/OP Ratio Volatility and Anomalies

The P/OP ratio remained relatively stable between 24.82 and 29.36 during 2022. A significant increase in the ratio began in September 2023, peaking at an anomalous 52.96 in June 2024. This spike was driven by a divergence where the share price recovered while operating profit per share concurrently dropped to its lowest point in the series. This resulted in a temporary valuation expansion that did not align with the underlying profit performance.

Valuation Normalization

Beginning in September 2024, the P/OP ratio returned to a normalized range, fluctuating between 22.67 and 28.67. This stabilization coincides with the steady growth of operating profit per share, which began to catch up with the rising share price. By September 2026, the ratio contracted to 23.09, indicating that the valuation had become more closely aligned with the actual operating earnings of the entity.

The Price-to-Sales (P/S) ratio analysis indicates a dynamic valuation cycle characterized by an initial period of contraction, a subsequent phase of recovery, and a significant expansion in market valuation relative to revenue.

Revenue Performance

Sales per share demonstrated a consistent and uninterrupted upward trajectory throughout the analyzed period. Starting at 43.61 USD in March 2022, the figure grew steadily to 71.13 USD by September 2026, indicating sustained growth in top-line performance on a per-share basis.

Valuation Compression

A downward trend in the P/S ratio is observed from March 2022 (2.27) through September 2023, where it reached a trough of 1.68. During this interval, the share price experienced volatility and a general decline, which outweighed the steady growth in sales per share, resulting in a compressed valuation multiple.

Valuation Expansion

A strong expansionary phase began in 2024, with the P/S ratio rising from 1.86 in March 2024 to a peak of 3.01 in December 2025 and June 2026. This trend corresponds with a sharp increase in the share price, which climbed from 113.75 USD to a high of 209.16 USD, reflecting an increase in investor premium attributed to the company's revenue.

Recent Trend Analysis

As of September 2026, the P/S ratio moderated to 2.72. While this represents a slight correction from the 3.01 peak, the ratio remains significantly elevated compared to the 2022-2023 average, suggesting a sustained higher valuation floor for the company's sales.

The Price to Book Value (P/BV) ratio exhibits a distinct upward trajectory over the analyzed period, transitioning from a relatively stable, low-multiple regime to a significantly expanded valuation. While the book value per share remained largely range-bound, a substantial increase in share price drove the expansion of the P/BV multiple, indicating an increase in the market premium attributed to the company's assets.

Initial Valuation Phase (2022 – September 2023)

During this period, the P/BV ratio fluctuated within a narrow band between 1.62 and 2.04. The ratio reached its lowest point of 1.62 on September 30, 2023, which coincided with the lowest recorded share price of $78.38. This phase was characterized by a relatively tight correlation between market price and book value.

Valuation Expansion Phase (October 2023 – June 2026)

A sustained and aggressive increase in the P/BV ratio began in late 2023. The ratio climbed from 2.05 in December 2023 to a peak of 4.25 by June 30, 2026. This expansion was primarily fueled by a surge in the share price, which rose from $92.24 in December 2023 to $209.16 in June 2026, effectively doubling the market's valuation of the company relative to its accounting book value.

Book Value Stability

The Book Value per Share (BVPS) demonstrated minimal volatility throughout the period, oscillating between a low of $44.34 in June 2024 and a high of $51.32 in September 2026. The lack of significant growth in BVPS confirms that the rising P/BV ratio is a result of market sentiment and price appreciation rather than an increase in the underlying net asset value per share.

Recent Trend and Correction

Following the peak in June 2026, a moderate correction is observed. The P/BV ratio declined from 4.25 to 3.77 by September 30, 2026. This decrease reflects a slight reduction in the share price to $193.34, although the valuation remains substantially higher than the levels observed between 2022 and 2023.