The firm raised its full year earnings estimates on March 9 and reaffirmed the raised guidance in the resent Q2 earnings report. Moreover RTX is currently engaged in a share-repurchase program, which sends a good signal to investors that 1) Management believe the share price is depressed and 2) Shareholder friendly policy that signals commitment to future dividends or share-repurchases.

The company has a insider ownership of over 9% and with an new employee share incentive scheme the right motivation is present. Further the Danish mutual fund, "Fundamental Invest", with the successful fund manager Michael Voss, owns 5,25%. Mr Voss is know for generating high returns and as being a sound value investor.

Relative to its competitors RTX, is cheap with a P/E of 12 relative to an average of 28. Further on EV/Revenue and on EV/EBITDA, RTX, is trading on lower multiples than its main competitors. Moreover with the growth that RTX is generating, it should be trading at lot higher.(See figure 1)

In a DCF model, being realistic and conservative, with estimated growth rates of 20% in the coming 2 years falling to around 13% YoY in 2020. Assuming that the margins stay at its current high levels.With an WACC of 11% and perpetuity growth rate of 4%.
This translate into a fair value of 156 DKK relative to its trading price of 89 DKK (of 17/07-15), which represents an upside potential of 75%.
Using the EBITDA multiple method its fair value is closer to 200 DKK, giving a upside potential of 121 %.

My recommendation is strong BUY.

Stay tuned for further FA analysis and global macro thoughts.

/Fama&French

(I currently don't hold a position in RTX, but will buy in the coming future)