U.S. Congressman buys RTX stock weeks before Raytheon awarded $3.3B missile contract

Representative Josh Gottheimer’s latest stock disclosure, as picked up by Finbold’s Congressional trading radar, revealed a suspiciously timed Raytheon (NYSE: RTX) purchase. 

Although only unveiled on May 14, the RTX stock investment, worth up to $15,000, was made on April 24, weeks ahead of a massive government contract modification.

Gottheimer buys RTX stock ahead of $2.1 billion missile contract increase

While buying equity of a defense giant by a Foreign Affairs committee member is nothing strange, it is noteworthy that the purchase came less than three weeks before the corporation’s $2.1 billion government contract increase was made public.

The Missile Defence Agency previously awarded Raytheon a $1.2 billion contract, but by May 12, it had been modified and increased by $2.1 billion, making it worth a total of $3.3 billion.

Under the terms of the agreement, the weapons company is to provide the management, material, and services related to the Standard Missile-3 Block variants for the U.S. and Foreign Military Sales partners.

The timing of the trade becomes even more notable when examining how RTX shares moved before and after the contract update. Raytheon’s stock price chart reveals that Representative Gottheimer did not purchase the equity at its 30-day lows, but took advantage of the uptrend as it developed. 

RTX stock rallies 12.19% since the Congressional buy

Raytheon shares fell to $113.75 on April 22 and recovered to $121.97 on April 24, the day the politician made the trade. Between the purchase date and the May 12 modification announcement, RTX rallied 7.04% and another 4.81% by press time in the May 16 pre-market.

In total, Raytheon stock is 12.19% up since Representative Josh Gottheimer executed the buy and is changing hands at $136.84.

Featured image via Shutterstock