Lockheed and the Other Primes: Customer and PeerNarrow moat

RTX (RTX) — moat facet

Lockheed Martin is Pratt & Whitney's customer on the F-35 and RTX's peer for the same budget, and RTX is worth more than Lockheed and General Dynamics together.

RTX's defence business sits among a small group of prime contractors, and its relationship with the largest of the others is a customer's. Lockheed Martin builds the F-35, and the F135 that powers every variant is Pratt & Whitney's1. RTX sells to Lockheed; Lockheed and RTX both sell to the Department of War.

RTX backlog by type, June 2026 ($bn)170Commercial119DefenceRTX Form 10-Q Q2 2026
Defence is 41% of the backlog.

By market value RTX is the largest of the group. At $255.27 billion2 it is worth more than Lockheed Martin at $121.09 billion and General Dynamics at $92.75 billion together, and more than three times Northrop Grumman at $73.08 billion34.

The primes compete less for individual contracts than for share of one budget. The 2027 U.S. base budget request is $1.1 trillion, about 25% more than the year before5. A dollar spent on aircraft, ships or space is a dollar not spent on missiles, and the primes lobby and bid for those priorities.

The relationship also runs the other way. As a subcontractor on the F-35, Pratt & Whitney depends on Lockheed's production rate and schedule; the F135's military sales rose 23% in the second quarter of 20266 partly because of the timing of a production lot.

RTX's defence business is large in its own right. Raytheon alone sold $28,043 million in 20257, and RTX's defence backlog was $119 billion in June 20268. The primes are peers in scale as well as in customers, which is why the contest between them is mostly about priorities in the budget rather than head-to-head bids.

The rivalry is mild while budgets rise. Watch RTX's share of defence bookings; its defence backlog grew from $107 billion to $119 billion in the first half of 20269, and a year in which it stalls while the budget grows would mean other primes are winning the priorities.

Moat trajectory: Holding steady

Defence backlog $107bn to $119bn in six months.

The number that tests this moat
Reported
RTX defence backlog growth, first half
$107bn to $119bn (Dec 2025 to Jun 2026)

RTX's share of a rising budget; a stall while budgets grow would mean other primes are winning.

Source: RTX Form 10-Q, Q2 2026 ↗
References
  1. ReportedLockheed Martin builds the F-35, and the F135 that powers every variant is Pratt & Whitney's.
    RTX Form 10-K for fiscal 2025 - Item 1 business: the three segments and their products, the GTF family powering more than 2,600 aircraft for over 90 operators, the F135 as sole-source engine on all F-35 variants, GTF Advantage certification, the IAE collaboration shares, employees (about 180,000 in 52 countries, 69% in the U.S.) and the divested businesses. — FY2025 · publ. 6 February 2026 · source ↗
  2. ReportedAt $255.27 billion it is worth more than Lockheed Martin at $121.09 billion and General Dynamics at $92.75 billion together, and more than three times Northrop Grumman at $73.08 billion.
    RTX Corporation (RTX) market data - $189.40 a share at the close on 25 September 2026, market cap $255.27B, revenue (ttm) $93.50B, net income $7.74B, EPS $5.68, 23 analysts with a $234.82 target, 52-week range $155.64-$226.88. — September 2026 · publ. 25 September 2026 · source ↗
  3. ReportedAt $255.27 billion it is worth more than Lockheed Martin at $121.09 billion and General Dynamics at $92.75 billion together, and more than three times Northrop Grumman at $73.08 billion.
    RTX market capitalisation history - year-end values $108.60B (2020), $128.81B (2021), $148.36B (2022), $120.99B (2023), $154.03B (2024), $245.90B (2025), and peer market caps (GE Aerospace $331.81B, Boeing $158.02B, Lockheed Martin $121.09B). — 2020-2026 · publ. September 2026 · source ↗
  4. Moat Explorer calcAt $255.27 billion it is worth more than Lockheed Martin at $121.09 billion and General Dynamics at $92.75 billion together, and more than three times Northrop Grumman at $73.08 billion.
    Moat Explorer calculation from RTX's Form 10-K FY2025, Q2 2026 earnings release and market data ($ millions unless stated). Goodwill plus intangibles 53,343 + 31,845 = 85,188; 85,188 / 171,079 = 49.8% of total assets; other assets 171,079 - 85,188 = 85,891. Reported against adjusted EPS 2025: 6.29 - 4.96 = 1.33, of which 1.15 acquisition accounting. Return on equity 6,732 / ((65,245 + 60,156) / 2) = 10.7%. Net debt: 37,700 + 204 - 7,435 = 30,469 (December 2025); 31,858 + 5,296 + 229 - 8,305 = 29,078 (June 2026). Net interest 1,749 / operating profit 9,300 = 18.8%. Dividends paid 3,574 / free cash flow 7,940 = 45%; free cash flow covers dividends 7,940 / 3,574 = 2.2 times. Pension items 753 + 1,182 = 1,935; 1,935 / net income 6,732 = 29%. Trailing twelve months to June 2026: revenue 88,603 + 46,784 - 41,887 = 93,500; net income 6,732 + 4,198 - 3,192 = 7,738. P/E 255.27 / 7.738 = 33.0; P/S 255.27 / 93.50 = 2.73. Year-end P/E = market value / net income and P/S = market value / revenue: 2021 128.81 / 3.864 = 33.3 and 128.81 / 64.388 = 2.00; 2022 148.36 / 5.197 = 28.5 and 2.21; 2023 120.99 / 3.195 = 37.9 and 120.99 / 68.920 = 1.76; 2024 154.03 / 4.774 = 32.3 and 1.91; 2025 245.90 / 6.732 = 36.5 and 2.78; 2020 108.60 / 56.587 = 1.92 (loss year). Revenue growth since 2023: 93.50 / 68.92 - 1 = 36%; market value 255.27 / 120.99 = 2.1 times. Share price against 52-week high 189.40 / 226.88 - 1 = -16.5%. Peers: Lockheed Martin plus General Dynamics 121.09 + 92.75 = 213.84 (below RTX's 255.27); RTX / Northrop Grumman 255.27 / 73.08 = 3.5 times. Q2 2026 operating margin 2,811 / 24,708 = 11.4%. Price over 2025 adjusted EPS 189.40 / 6.29 = 30 times. 2024 legal and termination cash 1.5 / free cash flow 4.534 = 33%. Pension sensitivity about 1.0 billion per 25 basis points, so about 4 billion per point; 4,000 / equity 65,245 = 6%. Enterprise value over trailing sales 285.82 / 93.50 = 3.1 times; price over 2026 consensus adjusted EPS 189.40 / 7.24 = 26 times. Purchase obligations after 2026 about 47 - 29 = 18 billion. Forecast extension: 2028 revenue 103.18 x 1.07 = 110.40 and EPS 7.85 x 1.084 = 8.51, extending 2027 consensus growth (not consensus). — 2020-2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in RTX's Forms 10-K and 10-Q, earnings releases, earnings call and market data; operands shown in the source line.
  5. ReportedThe 2027 U.S. base budget request is $1.1 trillion, about 25% more than the year before.
    RTX second-quarter 2026 earnings call transcript (The Motley Fool) - Raytheon bookings and book-to-bill, GTF aircraft-on-ground and MRO output, munitions output, framework agreements, the defence budget request, GTF Advantage, Collins margin plans and segment outlook - defence: Raytheon bookings, book-to-bill and backlog, munitions output, framework agreements and the budget request. — Q2 2026 · publ. 24 July 2026 · source ↗
  6. ReportedAs a subcontractor on the F-35, Pratt & Whitney depends on Lockheed's production rate and schedule; the F135's military sales rose 23% in the second quarter of 2026 partly because of the timing of a production lot.
    RTX second-quarter 2026 earnings call transcript (The Motley Fool) - Raytheon bookings and book-to-bill, GTF aircraft-on-ground and MRO output, munitions output, framework agreements, the defence budget request, GTF Advantage, Collins margin plans and segment outlook - defence: Raytheon bookings, book-to-bill and backlog, munitions output, framework agreements and the budget request. — Q2 2026 · publ. 24 July 2026 · source ↗
  7. ReportedRaytheon alone sold $28,043 million in 2025, and RTX's defence backlog was $119 billion in June 2026.
    RTX Form 10-K for fiscal 2025 - Item 7 segment review and Note 20: net sales and operating profit by segment for 2023-2025, organic sales drivers (commercial aftermarket, OEM, military), sales by customer type, products and services, segment assets, capital expenditure and research and development - Raytheon: segment sales, operating profit, organic drivers, defence bookings and customer types. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  8. ReportedRaytheon alone sold $28,043 million in 2025, and RTX's defence backlog was $119 billion in June 2026.
    RTX Form 10-Q for the quarter ended 30 June 2026 - backlog of $289 billion ($170 billion commercial, $119 billion defence), remaining performance obligations, the $0.4 billion powder-metal accrual, the Blue Canyon Technologies sale, Patriot awards and the remaining repurchase authority. — Q2 2026 · publ. 23 July 2026 · source ↗
  9. ReportedWatch RTX's share of defence bookings; its defence backlog grew from $107 billion to $119 billion in the first half of 2026, and a year in which it stalls while the budget grows would mean other primes are winning the priorities.
    RTX Form 10-Q for the quarter ended 30 June 2026 - backlog of $289 billion ($170 billion commercial, $119 billion defence), remaining performance obligations, the $0.4 billion powder-metal accrual, the Blue Canyon Technologies sale, Patriot awards and the remaining repurchase authority. — Q2 2026 · publ. 23 July 2026 · source ↗
Sources
Generated September 28, 2026