Core Viewpoint - RTX has shown significant stock performance over the past year and five years, outperforming the S&P 500 index, but it has underperformed compared to GE Aerospace, prompting investors to consider key factors before making investment decisions [1][2]. Performance Comparison - RTX's returns over different periods are as follows: 49% for 1 year, 77% for 3 years, and 137% for 5 years, while GE Aerospace achieved 65% for 1 year, 457% for 5 years, and the S&P 500 had returns of 13% for 1 year, 74% for 3 years, and 86% for 5 years [2]. Recent Issues - In 2023, RTX faced a contamination issue in powder coating used at Pratt & Whitney, affecting engines on the Airbus A320 neo family, which impacted earnings and cash flow, contributing to its underperformance relative to GE Aerospace [3]. Market Dynamics - Both RTX and GE Aerospace have benefited from the recovery in commercial aircraft departures post-lockdowns, but RTX has faced challenges in restoring engine production due to supply chain issues [5][6]. Defense Segment Challenges - RTX's significant exposure to the defense sector, particularly through its Raytheon segment, has led to difficulties in delivering on fixed-price development programs, resulting in a reported 9% increase in operating profit for 2024 compared to 2023, from $2.379 billion to $2.594 billion [8]. Financial Adjustments - The 2024 operating profit figure was positively impacted by a $375 million gain from a business sale, while a $575 million charge was reported due to the termination of a fixed-price development program with a foreign government, indicating potential ongoing issues in the defense sector [9]. Industry Outlook - The defense industry may be entering a phase of lower margins as governments negotiate more aggressively over complex and costly technology, which could affect RTX's future performance [10]. Investment Considerations - Despite RTX's stock outperforming the S&P 500 index, investors might have achieved better returns by focusing on companies with greater exposure to commercial aerospace, such as GE Aerospace [12].