U.S. Markets closed

Raytheon (RTN) Wins $45.5M Deal for ROTHR From U.S. Navy

Zacks Equity Research
Zacks.com featured highlights include: Lululemon, Sirius, Kohl's and Olympic Steel

Raytheon Company RTN announced that it has been awarded a $45.5-million contract by the U.S. Navy for the Relocatable Over-the-Horizon Radar system. According to the company, 50% of the work related to the contract will be carried out at its Dallastown, PA facility and the rest will be done at New Kent, Virginia (11 percent); Premont, Texas (11%); Vieques, Puerto Rico (11%); Chesapeake, Virginia (10%); Marlborough, Massachusetts (3%); Freer, Texas (2%) and Juana Diaz, Puerto Rico (2%). Operations are expected to be concluded by September 2022.

Relocatable Over-the-Horizon Radar system

The Relocatable Over-the-Horizon Radar system was developed to detect aircraft at any altitude or boats on the water. It works by refracting radar signals off the ionosphere which bounces back to the ground and up again. This radar is being used by the navy since 1986.

This system runs 24 hours a day, throughout the year and was once able to seize 4.5 metric tons of cocaine, valued at about $90 million. Its surveillance area is known to cover more than 10 million square miles of land and water. It consists of a transmit array and a receiving array in Texas, Virginia and Puerto Rico. It was designed and built by Raytheon. The company has also provided operations support and maintenance over the time.

Moving Forward with Strong Performance

Raytheon has a wide range of combat-proven defense product which helps it in securing scrumptious orders from both Pentagon as well as foreign allies of the nation. The company wins regular contracts from various sources, both domestic and international. About 34.7% of the company’s total booking during the second quarter was international booking, marking an increase of 2.4% year over year. Thanks to its strong performance, the company reported better-than-expected earnings during the second quarter of the year.

Notably, the defense scenario across the world at present, demands for new and innovative weapon which and defend a country and if the situation arises can help it in fighting too. This situation is not just limited to the United States but also other countries, fighting terrorism internally and externally. This has presented numerous opportunities to the defense giants such as Raytheon, Lockheed Martin Corporation LMT, The Boeing Company BA, Northrop Grumman Corporation NOC. The companies are already witnessing elevated number of contracts from the country and its allies.

Recently, the U.S. Senate passed fiscal 2018 defense policy bill worth $700 billion, which was proposed in July 2017. This bill provides about $640 billion for Pentagon’s main operations like buying weapons and paying the troops. The rest $60 billion for Overseas Contingency Operations will be utilized to fund the conflicts in Afghanistan, Iraq, Syria and elsewhere.

It is expected that this bill will rake in more new orders for the contractors and will boost both their top line and bottom line.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>


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
 
Northrop Grumman Corporation (NOC) : Free Stock Analysis Report
 
Boeing Company (The) (BA) : Free Stock Analysis Report
 
Lockheed Martin Corporation (LMT) : Free Stock Analysis Report
 
Raytheon Company (RTN) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research