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Textron's (TXT) Bell Clinches Contract for 12 AH-1Z Helicopters
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Textron Inc.’s (TXT - Free Report) business unit, Bell, recently secured a contract involving the AH-1Z helicopters. The award has been offered by the Naval Air Systems Command Patuxent River, MD.
Details of the Deal
Valued at $455 million, the contract is expected to be completed by July 2028. Per the terms of the deal, TXT’s Bell unit will manufacture and supply 12 AH-1Z helicopters to the government of Nigeria. Along with this, it will also provide associated engineering, program management and logistics support, and non-recurring engineering for obsolescence in relation to these helicopters.
The majority of the work related to this deal will be carried out in Fort Worth, TX.
What’s Favoring Textron?
Nations are reinforcing their military capabilities to strengthen their defense structure in the growing threat environment. In this context, military helicopters that play a critical role in military missions have also witnessed a significant rise in demand.
To this end, Bell Textron’s AX-1Z helicopter is the only attack helicopter in the world with fully-integrated air-to-air missile capability. With a speed of 200 knots and a range of 310 nanometer, the AX-1Z helicopter can serve attack, aerial reconnaissance and escort missions for the military.
Undoubtedly, the latest contract reflects the solid demand that Textron’s military helicopters enjoy globally. Such contract wins, in turn, should boost Textron’s revenue growth in the coming years.
TXT’s Prospects in the Military Helicopter Market
Rising military conflicts, terrorism, border disputes, territory invasions and violations have forced nations to increase their defense spending toward procuring combat-proven helicopters to enhance their aerial security. Per a report from the Mordor Intelligence firm, the global military helicopters market is expected to witness a CAGR of 2.90% during 2024-2030.
This offers strong growth opportunities for Textron, with the company’s Bell unit offering a robust portfolio of combat-proven helicopters like the Bell 360, V-280, V-22 and many more. Impressively, Bell ended 2023 with a backlog of $4.78 billion. The military aircraft and support programs of this segment generated revenues totaling $1.70 billion, comprising mainly of the U.S. government’s V-22 tiltrotor aircraft and the H-1 helicopter platforms.
Peer Moves
Apart from TXT, other companies expected to benefit from the growing military helicopter market are Lockheed Martin (LMT - Free Report) , Boeing (BA - Free Report) and Airbus Group (EADSY - Free Report) .
Lockheed Martin’s military helicopter portfolio contains programs like the Black Hawk, Seahawk and CH-53K King Stallion heavy-lift helicopters. During 2023, Lockheed delivered 63 helicopters on account of the U.S. government and international military helicopter programs.
LMT’s long-term (three to five years) earnings growth is pegged at 4.2%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 2.4% from that reported in 2023.
Boeing’s Defense, Space & Security segment’s primary military helicopter products include the AH-64 Apache, AH-6 Light Attack helicopter, H-47 Chinook and the MH-139. During 2023, deliveries of new-build production units, including remanufactures and modifications of these programs, totaled 99.
BA has a long-term earnings growth rate of 4%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 15.1% from the 2023 reported figure.
Airbus Group is one of the world's largest suppliers of advanced military helicopters. EADSY’s product portfolio includes the H135 combat helicopter, the H145M helicopter, AS565 MBe, H160M, H175M, H215M, H225M and a few more. During 2023, 52% of the Helicopters segment’s revenues came from the defense sector. In the 2024 Heli-Expo, Airbus secured a historic contract with THC for up to 120 helicopters of various types, with a firm order for eight H125s and 10 H145s.
EADSY has a long-term earnings growth rate is 12.4%. The consensus estimate for 2024 sales indicates an improvement of 9.5% from the 2023 reported figure.
Price Performance
In the past year, shares of TXT have rallied 34.5% against the industry’s 2.4% decline.
Image: Bigstock
Textron's (TXT) Bell Clinches Contract for 12 AH-1Z Helicopters
Textron Inc.’s (TXT - Free Report) business unit, Bell, recently secured a contract involving the AH-1Z helicopters. The award has been offered by the Naval Air Systems Command Patuxent River, MD.
Details of the Deal
Valued at $455 million, the contract is expected to be completed by July 2028. Per the terms of the deal, TXT’s Bell unit will manufacture and supply 12 AH-1Z helicopters to the government of Nigeria. Along with this, it will also provide associated engineering, program management and logistics support, and non-recurring engineering for obsolescence in relation to these helicopters.
The majority of the work related to this deal will be carried out in Fort Worth, TX.
What’s Favoring Textron?
Nations are reinforcing their military capabilities to strengthen their defense structure in the growing threat environment. In this context, military helicopters that play a critical role in military missions have also witnessed a significant rise in demand.
To this end, Bell Textron’s AX-1Z helicopter is the only attack helicopter in the world with fully-integrated air-to-air missile capability. With a speed of 200 knots and a range of 310 nanometer, the AX-1Z helicopter can serve attack, aerial reconnaissance and escort missions for the military.
Undoubtedly, the latest contract reflects the solid demand that Textron’s military helicopters enjoy globally. Such contract wins, in turn, should boost Textron’s revenue growth in the coming years.
TXT’s Prospects in the Military Helicopter Market
Rising military conflicts, terrorism, border disputes, territory invasions and violations have forced nations to increase their defense spending toward procuring combat-proven helicopters to enhance their aerial security. Per a report from the Mordor Intelligence firm, the global military helicopters market is expected to witness a CAGR of 2.90% during 2024-2030.
This offers strong growth opportunities for Textron, with the company’s Bell unit offering a robust portfolio of combat-proven helicopters like the Bell 360, V-280, V-22 and many more. Impressively, Bell ended 2023 with a backlog of $4.78 billion. The military aircraft and support programs of this segment generated revenues totaling $1.70 billion, comprising mainly of the U.S. government’s V-22 tiltrotor aircraft and the H-1 helicopter platforms.
Peer Moves
Apart from TXT, other companies expected to benefit from the growing military helicopter market are Lockheed Martin (LMT - Free Report) , Boeing (BA - Free Report) and Airbus Group (EADSY - Free Report) .
Lockheed Martin’s military helicopter portfolio contains programs like the Black Hawk, Seahawk and CH-53K King Stallion heavy-lift helicopters. During 2023, Lockheed delivered 63 helicopters on account of the U.S. government and international military helicopter programs.
LMT’s long-term (three to five years) earnings growth is pegged at 4.2%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 2.4% from that reported in 2023.
Boeing’s Defense, Space & Security segment’s primary military helicopter products include the AH-64 Apache, AH-6 Light Attack helicopter, H-47 Chinook and the MH-139. During 2023, deliveries of new-build production units, including remanufactures and modifications of these programs, totaled 99.
BA has a long-term earnings growth rate of 4%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 15.1% from the 2023 reported figure.
Airbus Group is one of the world's largest suppliers of advanced military helicopters. EADSY’s product portfolio includes the H135 combat helicopter, the H145M helicopter, AS565 MBe, H160M, H175M, H215M, H225M and a few more. During 2023, 52% of the Helicopters segment’s revenues came from the defense sector. In the 2024 Heli-Expo, Airbus secured a historic contract with THC for up to 120 helicopters of various types, with a firm order for eight H125s and 10 H145s.
EADSY has a long-term earnings growth rate is 12.4%. The consensus estimate for 2024 sales indicates an improvement of 9.5% from the 2023 reported figure.
Price Performance
In the past year, shares of TXT have rallied 34.5% against the industry’s 2.4% decline.
Image Source: Zacks Investment Research
Zacks Rank
Textron currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.