U.S. Markets close in 2 hrs 7 mins
  • S&P 500

    4,322.27
    -27.66 (-0.64%)
     
  • Dow 30

    34,078.44
    -89.65 (-0.26%)
     
  • Nasdaq

    13,383.65
    -158.47 (-1.17%)
     
  • Russell 2000

    1,938.15
    -38.31 (-1.94%)
     
  • Crude Oil

    86.82
    -0.53 (-0.61%)
     
  • Gold

    1,792.50
    -37.20 (-2.03%)
     
  • Silver

    22.67
    -1.13 (-4.75%)
     
  • EUR/USD

    1.1148
    -0.0097 (-0.8584%)
     
  • 10-Yr Bond

    1.7910
    -0.0570 (-3.08%)
     
  • Vix

    32.63
    +0.67 (+2.10%)
     
  • GBP/USD

    1.3380
    -0.0082 (-0.6128%)
     
  • USD/JPY

    115.1940
    +0.5340 (+0.4657%)
     
  • BTC-USD

    36,163.18
    -1,590.95 (-4.21%)
     
  • CMC Crypto 200

    826.23
    +6.73 (+0.82%)
     
  • FTSE 100

    7,554.31
    +84.53 (+1.13%)
     
  • Nikkei 225

    26,170.30
    -841.00 (-3.11%)
     

Bell-Boeing Wins $72M Deal to Support CV-22 Aircraft Program

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • BA
  • LMT
  • TXT
  • NOC

Bell-Boeing, a joint venture (JV) between The Boeing Company BA and Bell Helicopter — a unit of Textron Inc. TXT — recently secured a modification contract involving the fleet of CV-22 aircraft. Work related to the deal is scheduled to be completed by June 2025.

Details of the Deal

Valued at $71.9 million, the contract was awarded by the Naval Air Systems Command, Patuxent River, MD. Per the terms, the JV will procure 15 Nacelle improvements kits, rotatable pool components and interim spares for the CV-22 jets. It will also conduct the installation of eight kits in conjunction with conversion area harness and electrical wiring interconnect system assessments, sustaining engineering in support of the CV-22 program.

The majority of the work will be executed in Amarillo, TX.

Growing Jet Demand & V-22 Jets

A rapid increase in terror attacks has compelled nations to strengthen their arsenal and bump up defense budget. With the United States being the largest exporter of defense equipment across the world, the nation enjoys a steady flow of contracts for its combat-proven weaponries from both Pentagon and its foreign allies. With military jets and helicopters constituting a major portion of a nation’s armaments, there is a steady flow of contracts for these weaponries.

Bell-Boeing’s primary product, V-22 Osprey is a family of multi-mission, tiltrotor military aircraft with both vertical as well as short takeoff and landing capabilities. It is designed to combine the functionality of a conventional helicopter with the long-range, high-speed cruise performance of a turboprop aircraft. Notably, the CV-22 is a variant of the V-22 family of jets and helps conduct long-range infiltration, exfiltration and resupply missions for special operations forces.

Considering these features of the aforementioned family of tiltrotors and the growing demand for military aircraft, V-22 and its variants enjoy a decent demand pool across the globe. The latest deal win is a bright example of that.

Jet Manufacturers’ Prospects

Per a forecast made by Mordor Intelligence, the global military aircraft market size is projected to register a CAGR of 3% during the 2021-2030 period. This surely is going to benefit major U.S. combat aircraft manufacturers like Bell-Boeing, Lockheed LMT and Northrop Grumman NOC, with North America dominating this market space.

Notably, Lockheed Martin is one of the pioneers in the combat aircraft space, with its product portfolio constituting some of the most advanced military aircraft like F-35, C-130, F-16, F-22 and a few more. Of these, F-35 is the company’s largest program.

Interestingly, Lockheed reported third-quarter 2021 adjusted earnings of $6.66 per share, which surpassed the Zacks Consensus Estimate by a whopping 239.8%. In the past six months the stock has lost 12.9%.

On the other hand, Northrop is a renowned manufacturer of autonomous and manned aircraft like MQ-4C Triton and Global Hawk. These jets are used for battle management, strike and intelligence, surveillance and reconnaissance (ISR).

Notably, Northrop reported third-quarter 2021 earnings of $6.63 per share, which surpassed the Zacks Consensus Estimate by 11.8%. In the past six months, the stock declined 4.9%.

Price Movement & Zacks Rank

Textron’s stock has gained 66% in the past year against the industry’s decline of 26.4%. Boeing’s shares have risen 7.5% in the past year.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Both Textron and Boeing currently carry a Zacks Rank #3 (Hold). 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