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Lockheed (LMT) Wins $443M Contract for Black Hawk Helicopter
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Lockheed Martin Corp.’s (LMT - Free Report) business unit, Sikorsky, recently won a modification contract for the Black Hawk helicopter program. This deal has been awarded by the Army Contracting Command, Redstone Arsenal, AL.
Valued at $443 million, this contract is expected to be completed by Jun 30, 2027. Work related to this deal will be carried out in Stratford, CT.
What Favors Lockheed?
The tiff between Russia and Ukraine has compelled nations to increase their defense spending to fortify their defense structure against any sudden assault. Increased spending has been witnessed for defense arms and ammunition procurement. In this context, military helicopters that play an integral part in any defense landscape are likely to witness a surge in demand.
To this end, it is imperative to mention that U.S. military helicopters have gained prominence and significant traction lately due to advancements and integration of new tactical, logistical and other important features. Lockheed, being a prominent helicopter manufacturer, thus wins frequent contracts from the Pentagon and other U.S. allies for its combat-proven helicopter programs like Black Hawk.
Notably, LMT’s Black Hawk helicopter serves the U.S. military and the armed forces of 34 other countries worldwide as a tough, reliable utility helicopter. During the last 40 years, this aircraft has fought its way in and out of countless combat zones to deliver and extract troops, save lives as a MEDEVAC or casualty evacuation platform, provide critical supplies to troops, deliver emergency supplies during natural disasters, and perform as an aerial firefighter and border patroller.
Such remarkable features must have been ushering in helicopter contracts for LMT’s Black Hawk program, like the latest one. Such contract wins, in turn, should boost Lockheed’s revenue growth in the coming quarters.
LMT’s Prospects in Helicopter Market
Looking ahead, rising geopolitical and cross-border conflicts prevalent across the globe have forced nations to increase their defense spending toward procuring new aircraft and helicopters to enhance their aerial security. Per a report from the Mordor Intelligence firm, the global military rotorcraft market is likely to witness a CAGR of more than 4% during the 2023-2028 period.
Such a solid market prospect offers strong growth opportunities for Lockheed, with the company offering a solid portfolio for a handful of combat-proven helicopters. Impressively, more than 4,000 Black Hawk aircraft of all types are in service worldwide today. This surely reflects the solid demand that LMT’s Black Hawk helicopter program enjoys in the global military rotorcraft market.
Apart from Black Hawk, LMT’s Sikorsky unit includes helicopters like MH-60R Seahawk, HH-60W Combat Rescue helicopter, CH-53K, S-97 Raider and a few more. As the largest defense contractor in the United States and with a handful of combat-proven helicopters in its portfolio, LMT surely enjoys a competitive edge in the global rotorcraft market.
Peer Opportunities
Other renowned combat helicopter manufacturers that are likely to gain from the expanding global military rotorcraft market are Textron (TXT - Free Report) , Airbus (EADSY - Free Report) and Boeing (BA - Free Report) .
Textron’s business unit, Textron Aviation Defense designs, builds and supports versatile and globally known military aircraft preferred for training and attack missions. Some of Textron’s renowned products are the Beechcraft T-6C trainer and the AT-6 Wolverine.
TXT boasts a long-term earnings growth rate of 11.7%. The Zacks Consensus Estimate for 2023 sales implies growth of 6.4% from the 2022 reported figure.
Airbus is one of the world's largest suppliers of advanced military helicopters. Its product portfolio includes the H135 combat helicopter, H145M helicopter, AS565 MBe, H160M, H175M, H215M, H225M and a few more.
EADSY boasts a long-term earnings growth rate of 12.4%. The Zacks Consensus Estimate for its 2023 sales implies growth of 12.9% from the year-ago reported figure.
Boeing’s Defense, Space & Security segment’s primary products include fixed-wing military aircraft, F/A-18E/F Super Hornet, F-15 programs, P-8 programs, KC-46A Tanker and T-7A Red Hawk. This segment also produces rotorcraft and rotary-wing programs such as CH-47 Chinook, AH-64 Apache and V-22 Osprey.
BA boasts a long-term earnings growth rate of 4%. The Zacks Consensus Estimate for its 2023 sales implies an improvement of 15.7% from the 2022 reported figure.
Price Movement
In the past year, shares of Lockheed have lost 5.9% compared with the industry’s 8.8% decline.
Image: Shutterstock
Lockheed (LMT) Wins $443M Contract for Black Hawk Helicopter
Lockheed Martin Corp.’s (LMT - Free Report) business unit, Sikorsky, recently won a modification contract for the Black Hawk helicopter program. This deal has been awarded by the Army Contracting Command, Redstone Arsenal, AL.
Valued at $443 million, this contract is expected to be completed by Jun 30, 2027. Work related to this deal will be carried out in Stratford, CT.
What Favors Lockheed?
The tiff between Russia and Ukraine has compelled nations to increase their defense spending to fortify their defense structure against any sudden assault. Increased spending has been witnessed for defense arms and ammunition procurement. In this context, military helicopters that play an integral part in any defense landscape are likely to witness a surge in demand.
To this end, it is imperative to mention that U.S. military helicopters have gained prominence and significant traction lately due to advancements and integration of new tactical, logistical and other important features. Lockheed, being a prominent helicopter manufacturer, thus wins frequent contracts from the Pentagon and other U.S. allies for its combat-proven helicopter programs like Black Hawk.
Notably, LMT’s Black Hawk helicopter serves the U.S. military and the armed forces of 34 other countries worldwide as a tough, reliable utility helicopter. During the last 40 years, this aircraft has fought its way in and out of countless combat zones to deliver and extract troops, save lives as a MEDEVAC or casualty evacuation platform, provide critical supplies to troops, deliver emergency supplies during natural disasters, and perform as an aerial firefighter and border patroller.
Such remarkable features must have been ushering in helicopter contracts for LMT’s Black Hawk program, like the latest one. Such contract wins, in turn, should boost Lockheed’s revenue growth in the coming quarters.
LMT’s Prospects in Helicopter Market
Looking ahead, rising geopolitical and cross-border conflicts prevalent across the globe have forced nations to increase their defense spending toward procuring new aircraft and helicopters to enhance their aerial security. Per a report from the Mordor Intelligence firm, the global military rotorcraft market is likely to witness a CAGR of more than 4% during the 2023-2028 period.
Such a solid market prospect offers strong growth opportunities for Lockheed, with the company offering a solid portfolio for a handful of combat-proven helicopters. Impressively, more than 4,000 Black Hawk aircraft of all types are in service worldwide today. This surely reflects the solid demand that LMT’s Black Hawk helicopter program enjoys in the global military rotorcraft market.
Apart from Black Hawk, LMT’s Sikorsky unit includes helicopters like MH-60R Seahawk, HH-60W Combat Rescue helicopter, CH-53K, S-97 Raider and a few more. As the largest defense contractor in the United States and with a handful of combat-proven helicopters in its portfolio, LMT surely enjoys a competitive edge in the global rotorcraft market.
Peer Opportunities
Other renowned combat helicopter manufacturers that are likely to gain from the expanding global military rotorcraft market are Textron (TXT - Free Report) , Airbus (EADSY - Free Report) and Boeing (BA - Free Report) .
Textron’s business unit, Textron Aviation Defense designs, builds and supports versatile and globally known military aircraft preferred for training and attack missions. Some of Textron’s renowned products are the Beechcraft T-6C trainer and the AT-6 Wolverine.
TXT boasts a long-term earnings growth rate of 11.7%. The Zacks Consensus Estimate for 2023 sales implies growth of 6.4% from the 2022 reported figure.
Airbus is one of the world's largest suppliers of advanced military helicopters. Its product portfolio includes the H135 combat helicopter, H145M helicopter, AS565 MBe, H160M, H175M, H215M, H225M and a few more.
EADSY boasts a long-term earnings growth rate of 12.4%. The Zacks Consensus Estimate for its 2023 sales implies growth of 12.9% from the year-ago reported figure.
Boeing’s Defense, Space & Security segment’s primary products include fixed-wing military aircraft, F/A-18E/F Super Hornet, F-15 programs, P-8 programs, KC-46A Tanker and T-7A Red Hawk. This segment also produces rotorcraft and rotary-wing programs such as CH-47 Chinook, AH-64 Apache and V-22 Osprey.
BA boasts a long-term earnings growth rate of 4%. The Zacks Consensus Estimate for its 2023 sales implies an improvement of 15.7% from the 2022 reported figure.
Price Movement
In the past year, shares of Lockheed have lost 5.9% compared with the industry’s 8.8% decline.
Zacks Rank
Lockheed currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.