Lockheed Martin Corp. LMT has won a contract from the U.S. Air Force for Joint Air-to-Surface Standoff Missile Extreme Range (JASSM-XR). The contract is valued at $51.1 million and awarded by the Air Force Life Cycle Management Center, Eglin Air Force Base, Florida.
The work is scheduled to be completed by Aug 31, 2023 and executed at Orlando, FL. The contract will use fiscal 2017 and 2018 research and development funds to the extent of approximately $4.9 million.
Per the contract, Lockheed Martin will provide entire all-up round level systems engineering and programmatic activities coupled with the design, development, integration, testing and verification of component and subsystem design changes to the JASSM-XR baseline electronics, hardware, firmware and operational flight software.
A Brief Note on JASSM
JASSM is a stealthy, precision-guided cruise missile with a penetrating blast-fragmentation warhead. These missiles have been designed with infrared seekers and enhanced digital anti-jam Global Positioning System. The same is integrated on the B-1, B-2, B-52, F-16 and F-15E jets of the Air Force. Th missiles are also carried on the F/A-18A/B and F-18C/D aircraft worldwide. Lockheed has been manufacturing the JASSM cruise missiles at a Troy, AL-based plant since the late 1990s.
Lockheed Martin is the largest U.S. defense contractor with a platform-centric focus that guarantees a steady inflow of follow-on orders from a leveraged presence in the Army, Air Force, Navy and IT programs.
Meanwhile, toward the end of June 2018, the U.S. Senate approved the fiscal 2019 defense budget, provisioning major war fighting investments worth $21.7 billion for military aircraft. Lockheed Martin, one of the prime defense contractors in the United States, should be a significant beneficiary of this proposed budget.
Additionally, per a report by Markets and Markets research firm, the rocket and missile market is projected to witness a CAGR of 4.7% during the 2017-2022 period to $70 billion. This growth can be attributed to the aggravating geopolitical conflicts, war and terrorism, which are spurring demand for rockets and missiles globally and Lockheed with its wide range of missile offering is expected to benefit from the same.
In the past three months, Lockheed Martin’s stock has gained 2.5% against the Zacks Aerospace/Defense industry’s decline of 1.7%.
Zacks Rank & Stocks to Consider
Lockheed Martin currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the same sector are American Outdoor Brands Corporation AOBC, Huntington Ingalls Industries, Inc. HII and Textron, Inc. TXT, each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
American Outdoor Brands pulled off with an average positive surprise of 65.7% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has been revised 24.1% upward to 67 cents per share over the past 60 days.
Huntington Ingalls delivered an average earnings surprise of 9.5% in the trailing four quarters. The consensus estimate for 2018 bottom line per share has moved 6.3% north to $17.24 over the past 60 days.
Textron came up with an average beat of 20.4% in the preceding four quarters. The consensus mark for current-year earnings per share has been raised 5.1% to $3.33 over the past 60 days.
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