In my last article on January 21st, I had looked at the fundamental news affecting the defense sector in 2019. However, in this article, I will solely focus on Raytheon (RTN). This is as I expect the stock to have a slight correction after which it will be a solid buy. Hence, to establish the possibility of this occurring, I will look at the fundamentals of the stock, whilst also analyzing the charts using technical analysis tools.

Fundamental facets that matter:

Excellent order book:

Raytheon has mastered the art of securing large contracts from the U.S. government. I say this as the firm has a record backlog of approximately $41.6 billion, which is primarily made up of U.S. government contracts. However, this has unfortunately not translated into a stellar price performance as the stock, over the past one year, has tumbled by roughly 59%. Nevertheless, I still chose to highlight this as I expect the trend of securing large contracts to continue in 2019. This is because Raytheon's management expects the bookings to increase by $1 billion in the current year. Thus, I believe the solid order book will help the firm's earnings remain positive in the quarters to come.

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