RTX Corporation (NYSE: RTX) and General Dynamics (NYSE: GD) are both riding the wave of rising global defense budgets and escalating geopolitical tensions that continue to fuel aerospace and defense spending.
Both companies carry substantial order backlogs that provide strong revenue visibility and underpin their respective long-term growth trajectories in an increasingly competitive sector.
RTX operates a diversified business spanning commercial aerospace and defense, benefiting from robust demand for its Pratt & Whitney aircraft engines and Collins Aerospace systems as global air travel remains resilient.
Its defense segment draws on demand for missile systems, radar technologies and other advanced military solutions, giving the company multiple revenue streams that reduce dependence on any single market.
General Dynamics maintains a broad operational footprint across aerospace, marine systems, combat systems and technologies, including its well-regarded Gulfstream business jet line and a range of naval platforms.
On the investment front, RTX’s Collins Aerospace unit announced a $63 million commitment in June 2026 to expand its maintenance, repair and overhaul facility in Malaysia, targeting the region’s growing commercial aircraft fleet.
RTX also announced a $100 million expansion of its Portsmouth, Rhode Island facility to support higher production of Patriot GEM-T subcomponents and increase testing capacity for the Lower Tier Air and Missile Defense Sensor.
General Dynamics has been equally active in securing new business, highlighted by a $15.4 billion contract for continued design and support work on the Columbia-class submarines program awarded in its last reported quarter.
The company also received two contracts worth more than $4 billion for EAGLE tactical vehicles from Germany, along with $600 million in bridge contracts from Norway and the United Kingdom, and a $640 million award for light armored vehicles from Canada.
When it comes to 2026 earnings growth expectations, the Zacks Consensus Estimate for RTX points to sales growth of 5.7% and earnings per share growth of 9.9%, both figures outpacing General Dynamics’ projected sales growth of 4.7% and EPS growth of 7.2%.
RTX has also delivered a stronger average earnings surprise of 12.65% across the last four quarters, compared to General Dynamics’ average earnings surprise of 4.27% over the same period.
On stock price performance, RTX shares surged 28.2% over the past year, outpacing General Dynamics’ gain of 22.2% and reflecting stronger investor confidence in RTX’s diversified business model.
From a valuation standpoint, General Dynamics trades at a forward price-to-earnings multiple of 1.66 times forward sales, a discount to RTX’s multiple of 2.53 times, suggesting the market assigns a premium to RTX’s growth profile.
Both companies currently carry a Zacks Rank of 3, or Hold, but RTX’s stronger revenue and earnings growth outlook, recent capital investments and superior share price performance position it as the more attractive option for investors evaluating the defense sector.
