Textron Wins U.S. Army Contract
Textron Inc.'s (TXT) unit Textron Systems has received a task order from the U.S. Army Program Executive Office for Simulation, Training and Instrumentation (PEO-STRI). Per the contract, Textron Systems will have to supply 52 units of Man-Portable Aircraft Survivability Trainer (MAST) systems to the army for an undisclosed amount.
The latest order is a follow up of the Dec 2012 MAST system order by the U.S. Army. In addition, Textron also provides production and testing support to the army, under the STRI Omnibus Contract II. The contract can be extended by three years.
Textron’s MAST system uses a light-emitting diode and ultraviolet emitter threat simulator for the launch features of infrared Man-Portable Air Defense Systems. It also supports live training drills for aircrew and addresses surface-to-air missile (SAM) threats.
This system is inter-operable with the AN/AAR-47 Missile Warning System and AN/AAR-57 Common Missile Warning System, including the Smart On-board Data Interface Module (:SMODIM). The SMODIM enables the army to exercise force-on-force training at the Combat Training Centers.
In addition, the MAST system is able to replicate a SAM engagement string, including seeker lock and break lock capacities, rooted in environmental and situational circumstances. This system also can record SAM engagements throughout live training workouts.
These documented engagements are utilized to prepare the after-action reviews. It also offers support tactics and training methods prior to the actual deployment in the battlefield.
Over the years, Textron has had a long-standing strategic alliance with the U.S. defense establishments and tries to meet its commitments of maintaining product and service standards along with delivery timing.
In Jul 2012, the company provided 51 units of MAST systems to the U.S. Army's PEO-STRI under the Simulation, Training and Instrumentation Omnibus Contract II. Army benefited from the usage of MAST systems and hence ordered for more. The new orders will definitely help the company's financial results.
Providence, Rhode Island-based Textron Inc. is a global multi-industry company that manufactures aircraft, automotive engine components and industrial tools. It is also a provider of solutions and services for aircraft, fastening systems, and industrial products and components.
The diversified presence across commercial, manufacturing and industrial products, as well as financing operations, insulates the company from specific business risks. Also, its bottom line should get a boost from the modest increase in jet deliveries, growth in aftermarket sales, increase in commercial helicopter, and sales growth at Systems.
However, we remain concerned about the lower backlog at Cessna, rate of recovery of the business jet market and defense spending cutbacks. Textron currently has a Zacks Rank #3 (Hold).
Other stocks from the sector that are presently performing better include Crane Co. (CR), Honeywell International (HON) and Macquarie Infrastructure Company LLC (MIC). All three carry a Zacks Rank #2 (Buy).
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