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Lockheed Martin Corp. (LMT - Analyst Report) will continue to provide flight planning and safety support to pilots as the Federal Aviation Administration (“FAA”) has extended the Automated Flight Service Stations (“AFSS”) contract. This extended two-year contract worth $221 million will begin on Oct 1, 2013.

Lockheed Martin Flight Services has been updating and providing general aviation flight planning services in the U.S. since 2005. With its expertise, the company has been providing safe and efficient flight planning services to a number of pilots annually via phone and inflight radio.

However, with this contract, pilots are now able to file and close flight plans with Flight Services online, receive text, e-mail and satellite alerts during risky circumstances. Moreover, they can activate precise life-saving search and rescue tracking capabilities.

As a result of the company’s efforts, in 2012, the company filed more than 1 million flight plans for aviation pilots, provided more than 1.5 million pilot weather briefings, answered 457,575 aviation radio contacts, and helped pilots in 6,691 aviation search and rescue events.

In Sep 2010, the company received a five-year contract to operate automated flight service stations. This five-year contract included a three-year contract worth $356 million and a two-year contract option. The current contract is the execution of the two-year option. Per the three-year contract, Lockheed Martin served the general aviation community under the AFSS contract.

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. Despite the threat of sequestration, the company continues to receive contracts.

Recently, the company received a modification contract to provide technical services on the Aegis air defense system for the U.S. Navy. Per this contract, the company will have an option to provide technical engineering, configuration management, related equipment/supplies, quality assurance, information assurance, and additional operation and maintenance services for the Navy’s Aegis air defense system.

We expect the company to benefit from a strong defense focus on a number of its platform programs, such as, the C-130 Hercules & C-5 Galaxy transport aircraft, F-16 Fighting Falcon multi-role jet, MH-60 Helicopters, the Advanced Extremely High Frequency & the Global Positioning Satellite III system satellites, the Littoral Combat Ship, the Aegis Weapons System for mobile and sea-based missile defense and the Terminal High Altitude Area Defense system. The company presently retains a short-term Zacks Rank #2 (Buy).

Other stocks worth considering in the space are Huntington Ingalls Industries, Inc. (HII - Snapshot Report), Northrop Grumman Corp. (NOC - Analyst Report), and Raytheon Co. (RTN - Analyst Report), all with a Zacks Rank #2 (Buy).

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