The $10 Billion Buyback, and Then NothingNarrow moat

RTX (RTX) — moat facet

RTX bought back $12.9 billion of stock in 2023 at the recall's low and almost nothing since, letting debt fall instead.

RTX's capital returns have swung from one extreme to the other. It repurchased $12,870 million of its own stock in 2023, most of it through a $10 billion accelerated share repurchase that ran from October 2023 to September 20241. In 2024 it bought $444 million, and in 2025 only $50 million2. It bought none in the first half of 20263, and only about $0.6 billion of the 2023 authorization remains4.

RTX share repurchases ($M)12,87020234442024502025RTX Form 10-K FY2025, cash flow statement
From a flood to a trickle.

The big buyback began in October 20235, weeks after RTX announced the powder-metal charge together with a commitment to return $33 to $35 billion of capital from the merger through 20256. It retired shares at the low: diluted shares fell from 1,435.4 million in 2023 to 1,343.6 million in 20247.

Since then RTX has chosen to pay down debt, fund recall compensation and invest. Free cash flow rose to $7,940 million in 20258, while dividends took $3,574 million9, about 45% of it10.

The dividend is the constant. It was raised to $0.73 a quarter from $0.68 in 202611.

The dividend has risen steadily through the swings in buybacks. RTX raised its quarterly dividend to $0.73 in May 2026 from $0.6812, and dividends paid were $3,239 million in 2023, $3,217 million in 2024 and $3,574 million in 202513. The 2024 dip reflects fewer shares after the accelerated repurchase, not a smaller dividend.

A pause after a large buyback is sensible, especially with the share price near its highs. The question is what the next authorization looks like. With free cash flow guided at $8.50 to $8.75 billion for 202614, a new programme that takes most of the surplus after dividends would say management thinks the shares are still cheap.

Moat trajectory: Holding steady

Buybacks paused; dividend raised to $0.73.

The number that tests this moat
Reported
Free cash flow, full year
$7,940M (2025), guided $8.50-8.75bn for 2026

The cash available for returns; guidance missed would mean the recall and working capital still absorb it.

Source: RTX Q4 2025 earnings release ↗
⚠ Threats to the moat
⚠ THREAT 01
Paying 33 Times Earnings With No Buyback
RTX's share count has started to drift up because the stock now costs 33 times earnings and management has stopped buying.
References
  1. ReportedIt repurchased $12,870 million of its own stock in 2023, most of it through a $10 billion accelerated share repurchase that ran from October 2023 to September 2024.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  2. ReportedIn 2024 it bought $444 million, and in 2025 only $50 million.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  3. ReportedIt bought none in the first half of 2026, and only about $0.6 billion of the 2023 authorization remains.
    RTX second-quarter 2026 earnings release, Form 8-K exhibit 99 - sales of $24.7 billion, segment results, cash flow, balance sheet and raised 2026 outlook. — Q2 2026 · publ. 23 July 2026 · source ↗
  4. ReportedIt bought none in the first half of 2026, and only about $0.6 billion of the 2023 authorization remains.
    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 ↗
  5. ReportedThe big buyback began in October 2023, weeks after RTX announced the powder-metal charge together with a commitment to return $33 to $35 billion of capital from the merger through 2025.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  6. ReportedThe big buyback began in October 2023, weeks after RTX announced the powder-metal charge together with a commitment to return $33 to $35 billion of capital from the merger through 2025.
    RTX Form 8-K exhibit 99.1 of 11 September 2023, GTF fleet update - 600 to 700 engines to be removed for shop visits between 2023 and 2026, a $3 billion to $3.5 billion operating profit impact after partners' share, and the capital-return commitment. — September 2023 · publ. 11 September 2023 · source ↗
  7. ReportedIt retired shares at the low: diluted shares fell from 1,435.4 million in 2023 to 1,343.6 million in 2024.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  8. ReportedFree cash flow rose to $7,940 million in 2025, while dividends took $3,574 million, about 45% of it.
    RTX fourth-quarter and full-year 2025 earnings release, Form 8-K exhibit 99 - adjusted EPS of $6.29, free cash flow of $7,940 million, adjusted segment results and the January 2026 outlook. — FY2025 · publ. 27 January 2026 · source ↗
  9. ReportedFree cash flow rose to $7,940 million in 2025, while dividends took $3,574 million, about 45% of it.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  10. Moat Explorer calcFree cash flow rose to $7,940 million in 2025, while dividends took $3,574 million, about 45% of it.
    Moat Explorer calculation from RTX's Form 10-K FY2025, Q2 2026 earnings release and market data ($ 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.
  11. ReportedIt was raised to $0.73 a quarter from $0.68 in 2026.
    RTX dividend history - quarterly dividend of $0.730 from May 2026, $0.680 in February 2026. — 2026 · publ. September 2026 · source ↗
  12. ReportedRTX raised its quarterly dividend to $0.73 in May 2026 from $0.68, and dividends paid were $3,239 million in 2023, $3,217 million in 2024 and $3,574 million in 2025.
    RTX dividend history - quarterly dividend of $0.730 from May 2026, $0.680 in February 2026. — 2026 · publ. September 2026 · source ↗
  13. ReportedRTX raised its quarterly dividend to $0.73 in May 2026 from $0.68, and dividends paid were $3,239 million in 2023, $3,217 million in 2024 and $3,574 million in 2025.
    RTX Form 10-K for fiscal 2025 - consolidated financial statements and notes: income statement, cash flow, dividends and repurchases, long-term debt of $37,700 million, goodwill by segment, pension income, the 2024 resolution of certain legal matters, the Raytheon contract termination and the accelerated share repurchase. — FY2023-FY2025 · publ. 6 February 2026 · source ↗
  14. ReportedWith free cash flow guided at $8.50 to $8.75 billion for 2026, a new programme that takes most of the surplus after dividends would say management thinks the shares are still cheap.
    RTX second-quarter 2026 earnings release, Form 8-K exhibit 99 - sales of $24.7 billion, segment results, cash flow, balance sheet and raised 2026 outlook. — Q2 2026 · publ. 23 July 2026 · source ↗
Sources
Generated September 28, 2026