NEW YORK, Jan 8, 2026, 19:37 EST — Trading continues after hours
- RTX was up 0.8% in after-hours trade, after swinging between $184.94 and $197 in Thursday’s session
- Defense contractors moved on Trump’s call for a $1.5 trillion U.S. military budget in 2027
- A White House order would bar dividends and share buybacks until contractors hit delivery targets; RTX reports Jan. 27
RTX shares climbed 0.8% to $187.17 in after-hours trading Thursday, capping a wild ride that saw the stock soar more than 6% at one point. The jump came as defense stocks broadly rallied, fueled by President Donald Trump’s push for a $1.5 trillion U.S. military budget in 2027.
The budget talk came just a day after the White House slapped down an executive order banning dividends and share buybacks — when companies use cash to buy back their own stock — until contractors actually deliver a better product, on time and within budget. The order also calls for a 30-day review to pinpoint underperforming contractors who have handed cash back to shareholders, with possible enforcement actions on the table.
That tension is fueling trading right now: defense budgets are climbing, yet there’s less flexibility to return cash to shareholders, and production is under tighter scrutiny. Morgan Stanley analysts led by Kristine Liwag pointed out that “a limit on capital return is an incremental negative, but the size is manageable,” while Investec’s Ben Bourne reckoned this policy could steer investors toward UK defense shares. “Geopolitics is the inescapable story of 2026 thus far,” said Saxo Bank strategist Neil Wilson. Reuters
Trump has set his sights on Raytheon, a major part of RTX, warning it could lose U.S. government contracts if it keeps up with stock buybacks. “Under no circumstances will they be allowed to do any additional Stock Buybacks,” he declared in a social media post. Reuters
RTX said it will unveil its fourth-quarter and full-year results on Jan. 27, ahead of the U.S. market opening. A conference call is set for 8:30 a.m. ET to discuss the outlook for 2026.
But plenty could still go sideways. A bigger Pentagon budget needs to pass Congress first. Meanwhile, investors are left guessing just how strictly the payout limits will be applied, and who will actually get caught up in it, as procurement officials start sorting “underperformers” from the rest.
Traders keeping an eye on RTX are eager for early signs of how Washington plans to enforce the order, and whether contractors might tweak their capital-return moves. The date to circle is Jan. 27, when RTX is set to report earnings and lay out 2026 guidance, alongside production priorities.
