Advertisement
UK markets close in 2 hours 38 minutes
  • FTSE 100

    7,968.16
    +36.18 (+0.46%)
     
  • FTSE 250

    19,878.15
    +67.49 (+0.34%)
     
  • AIM

    744.05
    +1.94 (+0.26%)
     
  • GBP/EUR

    1.1690
    +0.0021 (+0.18%)
     
  • GBP/USD

    1.2643
    +0.0005 (+0.04%)
     
  • Bitcoin GBP

    56,068.69
    +264.89 (+0.47%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,253.57
    +5.08 (+0.10%)
     
  • DOW

    39,771.22
    +11.14 (+0.03%)
     
  • CRUDE OIL

    82.52
    +1.17 (+1.44%)
     
  • GOLD FUTURES

    2,226.10
    +13.40 (+0.61%)
     
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     
  • HANG SENG

    16,541.42
    +148.58 (+0.91%)
     
  • DAX

    18,495.36
    +18.27 (+0.10%)
     
  • CAC 40

    8,223.31
    +18.50 (+0.23%)
     

Northrop (NOC) Wins $50M Deal to Support E-2D Hawkeye Aircraft

Northrop Grumman Corp.’s NOC business unit, Northrop Grumman Systems Corp., recently secured a modification contract involving E-2D Hawkeye aircraft. The award has been offered by the Naval Air Systems Command, Patuxent River, MD.

Details of the Deal

Valued at $50 million, the contract is expected to be completed by February 2027. Per the terms of the deal, Northrop will provide non-recurring engineering and product support for production of the 11th lot of E-2D Hawkeye aircraft.

A major portion of this contract will be carried out in Melbourne, and St. Augustine, FL; Liverpool, NY; and El Segundo, CA.

Importance of E-2D Advanced Hawkeye

Northrop’s E-2D Advanced Hawkeye aircraft boasts battle management, theater air, missile defense and multiple sensor fusion capabilities in an airborne system. These provide the warfighter with expanded battlespace awareness, especially in the field of information operations.

ADVERTISEMENT

Advanced Hawkeye provides critical, actionable data to joint forces and first responders through its effective radar sensor and robust network-enabled capability. Such features of the aircraft make it an attractive option for the military, resulting in NOC winning multiple orders for the same. The latest contract win is a testament to this. The new orders are likely to boost the company’s revenue-generation prospects from the military aircraft business arena.

Growth Prospects

Countries across the world have been reinforcing their military resources due to intense geopolitical tensions and amplified terrorist threats. To this end, a military aircraft that forms an integral part of any air defense system is likely to witness an increased demand.

Per a report from Mordor Intelligence, the military aircraft market is projected to witness a CAGR of 4% over the 2022-2031 period. Such growth prospects may benefit Northrop Grumman, as its military aviation system offers a wide range of manned and unmanned aircraft with an established position in the combat aircraft market.

The abounding growth prospects should benefit defense majors that have already forayed into the aforementioned market. These include Lockheed Martin LMT, Boeing BA and Textron TXT.

Lockheed’s Aeronautics segment is engaged in the research, design, development, manufacturing, integration, sustainment, support and upgrade of advanced military aircraft, including combat and air mobility aircraft, unmanned air vehicles and related technologies. Its major programs include the F-35 Lightning II Joint Strike Fighter jet, the C-130 Hercules airlifter, the F-16 Fighting Falcon jet and the F-22 Raptor jet.

The company’s long-term earnings growth rate is pegged at 6.9%. It has a four-quarter average earnings surprise of 6.86%.

Boeing’s Defense, Space & Security segment’s primary products include fixed-wing military aircraft, F/A-18E/F Super Hornet, F-15 programs, P-8 programs, KC-46A Tanker and T-7A Red Hawk. The segment also manufactures rotorcraft and rotary-wing programs, such as CH-47 Chinook, AH-64 Apache and V-22 Osprey.

BA’s long-term earnings growth rate is pegged at 4%. The Zacks Consensus Estimate for its 2023 sales indicates a 22.1% increase from the prior-year reported figure.

Textron’s business unit, Textron Aviation Defense, designs, builds and supports versatile and globally known military aircraft, preferred for training and attack missions. Some of its renowned products include the Beechcraft T-6C trainer and the AT-6 Wolverine.

TXT boasts a long-term earnings growth of 11.2%. The Zacks Consensus Estimate for its 2023 sales indicates a 8.1% increase from the prior-year reported figure.

Price Movement

In the past year, shares of Northrop Grumman have gained 0.9% against the industry’s 15.2% decline.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Zacks Rank

Northrop Grumman currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

The Boeing Company (BA) : Free Stock Analysis Report

Lockheed Martin Corporation (LMT) : Free Stock Analysis Report

Northrop Grumman Corporation (NOC) : Free Stock Analysis Report

Textron Inc. (TXT) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research