Longleaf Partners Fund Exited RTX Corporation (RTX) at a Gain

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21-04-2025

Longleaf Partners, managed by Southeastern Asset Management, released its 'Partners Fund' first quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund returned -5.14% in the first quarter, compared to the S&P 500's -4.27% return and Russell 1000 Value's 2.14% return. The firm's stock price performance was volatile, but its confidence in future returns grew as the quarter progressed. The firm invested in quality companies that it thinks are strong and resilient to difficult circumstances. The portfolio has significantly outperformed the index, demonstrating this resiliency since the market peak on February 19th. The rise of its underlying value per share outpaced the performance of the stock price during the quarter. For more information on the fund's best picks in 2025, please check its top five holdings.
In its first-quarter 2025 investor letter, Longleaf Partners Fund highlighted stocks such as RTX Corporation (NYSE:RTX). RTX Corporation (NYSE:RTX) is an aerospace and defense company. The one-month return of RTX Corporation (NYSE:RTX) was -4.15%, and its shares gained 27.98% of their value over the last 52 weeks. On April 17, 2025, RTX Corporation (NYSE:RTX) stock closed at $128.89 per share with a market capitalization of $172.08 billion.
Longleaf Partners Fund stated the following regarding RTX Corporation (NYSE:RTX) in its Q1 2025 investor letter:
"RTX Corporation (NYSE:RTX) – Aerospace and defense company RTX was a contributor this quarter. We purchased RTX at a significant discount in 2023 when concerns over Pratt & Whitney's Geared Turbofan (GTF) issues reached what turned out to be a point of max pessimism. We also were able to partner with great leaders in Greg Hayes & Chris Calio, who took advantage of this opportunity to repurchase a material amount of stock while improving operations. Just last quarter, we wrote how strong industry tailwinds, prudent capital allocation and a solid balance sheet provide a foundation for sustained growth and eventual full value recognition. That thesis played out this quarter, as the stock price traded through our value, and we exited our position at a gain."
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RTX Corporation (NYSE:RTX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 80 hedge fund portfolios held RTX Corporation (NYSE:RTX) at the end of the fourth quarter which was 72 in the previous quarter. While we acknowledge the potential of RTX Corporation (NYSE:RTX) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we covered RTX Corporation (NYSE:RTX) and shared the list of best robotics stocks to buy according to billionaires. RTX Corporation (NYSE:RTX) was a key contributor to the Longleaf Partners Fund's performance last year, supported by strong industry tailwinds, strategic capital allocation, and a solid balance sheet for sustained growth. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.