RTX Secures $1.25B Contract for Iron Dome Interceptors
Raytheon-Rafael joint venture to produce Tamir missiles at new U.S. facility, highlighting surge in global demand for advanced air defense systems.
A joint venture between RTX and Israel's Rafael Advanced Defense Systems has secured a landmark $1.25 billion contract to produce Tamir missile interceptors, the critical component of the battle-proven Iron Dome air defense system. The deal underscores the intense global demand for advanced missile defense capabilities amid escalating geopolitical tensions.
The contract was awarded to R2S Inc., the U.S.-based joint venture, and will support both U.S. and Israeli defense programs. Production will take place at a newly established facility in East Camden, Arkansas, marking the first time the Tamir interceptor will be manufactured in its entirety on U.S. soil. This strategic move aims to bolster the supply chain for a system that has seen extensive use.
Shares of RTX were trading at approximately $169.18 in Friday's session. The company, a bellwether for the industrials sector, has seen its valuation supported by a surge in defense spending from the U.S. and its allies. The stock is trading well above its 200-day moving average, reflecting sustained investor confidence.
"This is the first production contract for the R2S joint venture, and it is a significant milestone for the Raytheon and Rafael partnership," said Jonathan Casey, CEO of R2S, in a statement. The award is part of a broader trend benefiting major defense contractors. RTX reported a record backlog of $251 billion in its third-quarter earnings report, signaling a long runway of future revenue from both its commercial aerospace and defense segments.
The Tamir interceptor, which has an operational success rate exceeding 95% according to its developers, is a cornerstone of Israel's multi-layered air defense network. The establishment of a U.S. production line not only accelerates output for Israel but also positions the technology for broader adoption. A U.S. variant of the missile, named SkyHunter, is slated for use by the U.S. Marine Corps' Medium-Range Intercept Capability (MRIC) program.
Wall Street has taken note of the favorable market dynamics for RTX. Earlier this month, analysts at BNP Paribas Exane initiated coverage on the stock with an "outperform" rating and a $210 price target, citing strong execution and backlog momentum.
This contract arrives as nations re-evaluate their defense postures in response to conflicts in Eastern Europe and the Middle East. The demand for interceptors, munitions, and surveillance technology has driven significant order flow to top-tier defense firms. While the sector faces persistent headwinds from supply chain constraints and labor shortages, the powerful tailwind of government spending continues to dominate the narrative for companies like RTX, Lockheed Martin, and Northrop Grumman.
The $1.25 billion award provides a tangible data point for this trend, solidifying RTX's central role in supplying critical defense technologies to the U.S. and its key international partners. The new Arkansas facility, a result of a $33 million capital investment, is expected to create dozens of local jobs while strengthening the domestic industrial base for missile production.