Lockheed Martin Corp.’s LMT business unit, Aeronautics recently won a modification contract to procure four F-35C Carrier Variant aircraft for the Navy. Work related to this deal is expected to be completed by May 2023.
The majority of the task will be executed in Fort Worth, TX. Valued at $360.8 million, the contract was awarded by the Naval Air Systems Command, Patuxent River, MD.
Rising security threat from terrorist activities and adverse geopolitical situations have resulted in increased need for enhancing United States’ defense budget, of which combat aircraft constitutes a major portion. With its advanced stealth capabilities, combined with fighter aircraft speed and agility, F-35 jet dominates the combat aircraft market.
Notably, the F-35C carrier variant (CV) is the world’s only fifth generation, long-range stealth strike fighter designed and built for carrier operations.It has larger wings and more robust landing gear than the other variants, making it suitable for catapult launches and fly-in arrestments aboard naval aircraft carriers.
Impressively, the F-35 program is supported by an international team of leading aerospace majors, which makes the program reliable and attractive. Notably, Northrop Grumman NOC rendered its expertise in carrier aircraft and low-observable stealth technology to this program, while Raytheon Technologies’ RTX Pratt & Whitney offered its world renowned jet engines. BAE Systems’ BAESY short takeoff and vertical landing experience, and air systems sustainment supported the jet’s combat capabilities.
Over the long run, production of F-35 jets is expected to continue steadily, given the U.S. government's current inventory target of 2,456 aircraft for the Air Force, Marine Corps and Navy. Consequently, we expect Lockheed to witness more order inflows for F-35, which in turn should bolster this defense contractor’s top line.
Price Performance & Zacks Rank
Lockheed Martin’s stock has slipped 0.7% in the past year compared with the industry’s decline of 28.9%.
Lockheed Martin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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