Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).

Current Valuation Ratios
Historical Valuation Ratios (Summary)
Price to Earnings (P/E)
Price to Operating Profit (P/OP)
Price to Sales (P/S)
Price to Book Value (P/BV)

Raytheon Co., current price multiples

	Raytheon Co.	Boeing Co.	General Dynamics Corp.	Lockheed Martin Corp.	Northrop Grumman Corp.	United Technologies Corp.	Aerospace & Defense	Industrials
Selected Financial Data
Current share price (P)	$216.70
No. shares of common stock outstanding	278,479,000
Growth rate (g)	13.82%

Earnings per share (EPS)	$10.45
Next year expected EPS	$11.89
Operating profit per share	$16.30
Sales per share	$97.16
Book value per share (BVPS)	$41.20
Valuation Ratios (Price Multiples)
Price to earnings (P/E)	20.74	19.77	16.02	21.81	18.56	24.27	20.44	30.37
Price to next year expected earnings	18.23	3.03	13.73	10.59	14.88	21.70	16.70	27.75
Price-earnings-growth (PEG)	1.50	0.04	0.96	0.21	0.75	2.05	0.91	3.22
Price to operating profit (P/OP)	13.30	17.25	12.02	15.01	15.86	14.95	15.22	14.89
Price to sales (P/S)	2.23	2.04	1.48	2.05	1.99	1.92	1.97	2.09
Price to book value (P/BV)	5.26	610.01	4.57	78.95	7.32	3.33	8.64	6.86

Based on: 10-K (filing date: 2019-02-13).

If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.

Raytheon Co., historical price multiples

	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
Price to earnings (P/E)	17.56	30.30	20.13	18.25	14.67
Price to operating profit (P/OP)	11.25	18.48	13.74	12.56	10.36
Price to sales (P/S)	1.89	2.42	1.85	1.63	1.44
Price to book value (P/BV)	4.45	6.16	4.42	3.74	3.46

Based on: 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-11).

Valuation ratio	Description	The company
P/E ratio	The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings.	Raytheon Co.’s P/E ratio increased from 2016 to 2017 but then declined significantly from 2017 to 2018.
P/OP ratio	Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit.	Raytheon Co.’s P/OP ratio increased from 2016 to 2017 but then declined significantly from 2017 to 2018.
P/S ratio	An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative.	Raytheon Co.’s P/S ratio increased from 2016 to 2017 but then slightly declined from 2017 to 2018 not reaching 2016 level.
P/BV ratio	The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company’s required rate of return and its actual rate of return.	Raytheon Co.’s P/BV ratio increased from 2016 to 2017 but then slightly declined from 2017 to 2018 not reaching 2016 level.

Raytheon Co., historical P/E calculation, comparison to benchmarks

	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
No. shares of common stock outstanding¹	282,239,000	288,506,000	292,880,000	298,998,000	307,323,000
Selected Financial Data (US$)
Net income attributable to Raytheon Company (in millions)	2,909	2,024	2,211	2,074	2,244
Earnings per share (EPS)²	10.31	7.02	7.55	6.94	7.30
Share price^1, 3	180.94	212.58	151.96	126.57	107.15
Valuation Ratio
P/E ratio⁴	17.56	30.30	20.13	18.25	14.67
Benchmarks
P/E Ratio, Competitors⁵
Boeing Co.	21.87	24.68	20.50	14.89	19.15
General Dynamics Corp.	14.95	21.37	18.75	13.88	17.93
Lockheed Martin Corp.	16.88	48.70	14.14	18.36	16.86
Northrop Grumman Corp.	14.48	29.23	18.21	17.15	15.27
United Technologies Corp.	19.74	21.97	17.55	9.31	17.52
P/E Ratio, Sector
Aerospace & Defense	18.70	26.83	17.86	13.97	17.36
P/E Ratio, Industry
Industrials	28.09	28.48	22.75	23.39	18.71

Based on: 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-11).

¹ Data adjusted for splits and stock dividends.

² 2018 Calculation
EPS = Net income attributable to Raytheon Company ÷ No. shares of common stock outstanding
= 2,909,000,000 ÷ 282,239,000 = 10.31

³ Closing price as at the filing date of Raytheon Co.’s Annual Report.

⁴ 2018 Calculation
P/E ratio = Share price ÷ EPS
= 180.94 ÷ 10.31 = 17.56

⁵ Click competitor name to see calculations.

Valuation ratio	Description	The company
P/E ratio	The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings.	Raytheon Co.’s P/E ratio increased from 2016 to 2017 but then declined significantly from 2017 to 2018.

Raytheon Co., historical P/OP calculation, comparison to benchmarks

	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
No. shares of common stock outstanding¹	282,239,000	288,506,000	292,880,000	298,998,000	307,323,000
Selected Financial Data (US$)
Operating income (in millions)	4,538	3,318	3,240	3,013	3,179
Operating profit per share²	16.08	11.50	11.06	10.08	10.34
Share price^1, 3	180.94	212.58	151.96	126.57	107.15
Valuation Ratio
P/OP ratio⁴	11.25	18.48	13.74	12.56	10.36
Benchmarks
P/OP Ratio, Competitors⁵
Boeing Co.	19.08	19.69	17.20	10.36	13.96
General Dynamics Corp.	11.22	14.90	12.86	9.85	11.68
Lockheed Martin Corp.	11.62	16.47	13.51	12.17	10.89
Northrop Grumman Corp.	12.37	17.85	12.55	11.10	9.88
United Technologies Corp.	12.16	11.53	10.86	9.71	11.15
P/OP Ratio, Sector
Aerospace & Defense	13.92	16.33	13.33	10.75	11.61
P/OP Ratio, Industry
Industrials	13.78	15.57	15.55	12.60	11.54

Based on: 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-11).

¹ Data adjusted for splits and stock dividends.

² 2018 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 4,538,000,000 ÷ 282,239,000 = 16.08

³ Closing price as at the filing date of Raytheon Co.’s Annual Report.

⁴ 2018 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 180.94 ÷ 16.08 = 11.25

⁵ Click competitor name to see calculations.

Valuation ratio	Description	The company
P/OP ratio	Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit.	Raytheon Co.’s P/OP ratio increased from 2016 to 2017 but then declined significantly from 2017 to 2018.

Raytheon Co., historical P/S calculation, comparison to benchmarks

	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
No. shares of common stock outstanding¹	282,239,000	288,506,000	292,880,000	298,998,000	307,323,000
Selected Financial Data (US$)
Net sales (in millions)	27,058	25,348	24,069	23,247	22,826
Sales per share²	95.87	87.86	82.18	77.75	74.27
Share price^1, 3	180.94	212.58	151.96	126.57	107.15
Valuation Ratio
P/S ratio⁴	1.89	2.42	1.85	1.63	1.44
Benchmarks
P/S Ratio, Competitors⁵
Boeing Co.	2.26	2.17	1.06	0.80	1.15
General Dynamics Corp.	1.38	2.01	1.77	1.31	1.47
Lockheed Martin Corp.	1.58	1.91	1.59	1.43	1.34
Northrop Grumman Corp.	1.55	2.28	1.63	1.45	1.32
United Technologies Corp.	1.56	1.67	1.55	1.26	1.67
P/S Ratio, Sector
Aerospace & Defense	1.80	2.03	1.45	1.18	1.38
P/S Ratio, Industry
Industrials	1.94	2.13	1.99	1.72	1.85

Based on: 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-11).

¹ Data adjusted for splits and stock dividends.

² 2018 Calculation
Sales per share = Net sales ÷ No. shares of common stock outstanding
= 27,058,000,000 ÷ 282,239,000 = 95.87

³ Closing price as at the filing date of Raytheon Co.’s Annual Report.

⁴ 2018 Calculation
P/S ratio = Share price ÷ Sales per share
= 180.94 ÷ 95.87 = 1.89

⁵ Click competitor name to see calculations.

Valuation ratio	Description	The company
P/S ratio	An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative.	Raytheon Co.’s P/S ratio increased from 2016 to 2017 but then slightly declined from 2017 to 2018 not reaching 2016 level.

Raytheon Co., historical P/BV calculation, comparison to benchmarks

	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
No. shares of common stock outstanding¹	282,239,000	288,506,000	292,880,000	298,998,000	307,323,000
Selected Financial Data (US$)
Total Raytheon Company stockholders’ equity (in millions)	11,472	9,963	10,066	10,128	9,525
Book value per share (BVPS)²	40.65	34.53	34.37	33.87	30.99
Share price^1, 3	180.94	212.58	151.96	126.57	107.15
Valuation Ratio
P/BV ratio⁴	4.45	6.16	4.42	3.74	3.46
Benchmarks
P/BV Ratio, Competitors⁵
Boeing Co.	674.83	569.92	122.80	12.17	12.04
General Dynamics Corp.	4.26	5.44	5.05	3.83	3.84
Lockheed Martin Corp.	61.11	—	49.61	21.37	17.92
Northrop Grumman Corp.	5.71	8.36	7.62	6.18	4.37
United Technologies Corp.	2.71	3.38	3.22	2.59	3.49
P/BV Ratio, Sector
Aerospace & Defense	7.91	10.09	7.19	5.18	5.34
P/BV Ratio, Industry
Industrials	6.35	6.01	5.41	4.16	3.99

Based on: 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-11).

¹ Data adjusted for splits and stock dividends.

² 2018 Calculation
BVPS = Total Raytheon Company stockholders’ equity ÷ No. shares of common stock outstanding
= 11,472,000,000 ÷ 282,239,000 = 40.65

³ Closing price as at the filing date of Raytheon Co.’s Annual Report.

⁴ 2018 Calculation
P/BV ratio = Share price ÷ BVPS
= 180.94 ÷ 40.65 = 4.45

⁵ Click competitor name to see calculations.

Valuation ratio	Description	The company
P/BV ratio	The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company’s required rate of return and its actual rate of return.	Raytheon Co.’s P/BV ratio increased from 2016 to 2017 but then slightly declined from 2017 to 2018 not reaching 2016 level.

Raytheon Co. (RTN)

Common Stock Valuation Ratios (Price Multiples)

Current Valuation Ratios

Historical Valuation Ratios (Summary)

Price to Earnings (P/E)

Price to Operating Profit (P/OP)

Price to Sales (P/S)

Price to Book Value (P/BV)