Raytheon Company (RTN) Reports Tomorrow, Stay Away
Yes, you heard it straight from the source and current shareholder that I think Raytheon is going to struggle tomorrow after it reports earnings. Now, currently Raytheon (RTN) is trading above $50 a share, and has moved strongly since breaking $48 resistance. Defense sales are up, and yes the company will beat earnings tomorrow.
Wait, so beat earnings but still struggle? What’s the deal?
The answer to this riddle lies within its peers, Lockheed (LMT), General Dynamic (GD), Boeing (BA), Northrup Group (NOC), and others. All of these companies are in the same Aerospace/defense Industry Group as RTN, and all reported strong earnings. BUT, almost all of them were downgraded shortly after, and all stocks slipped because of the outlook for down the road. If the leader struggles on strong earnings, and others follow suit, it is my bet that RTN is next to get the sour treatment.
As a result I have sold well over half my position, taking profits since buying the stock at the $48 resistance break in early October. I am going to hold the rest just in case my outlook is wrong and somehow RTN stands out as the sole gainer with its earnings increase. Regardless of what I think, I advise a hint of caution for tomorrow’s earnings release.
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