The Boeing Co. (BA Quick QuoteBA - Free Report) has won a modification contract, worth $100.4 million, from the U.S. Navy to provide support services for the production of Lot 8 P-8A Multi-mission Maritime Aircraft. Contracting activity is the Naval Air Systems Command, Patuxent River, MA.

Per the contract, Boeing will supply long-lead parts and efforts related to the manufacture of four full-rate production P-8A aircraft. Note that the U.S. Department of Defense (DoD) has a cooperative engagement agreement with the government of Australia for the aircraft.

Work is scheduled to be complete by Jun 2017. The company will carry out the majority of the work in Seattle, WA, while the rest will be performed in Baltimore, MA; Greenlawn, NY; North Amityville, NY; and Cambridge, UK. The contract will use Cooperative engagement agreement funds.
 

Boeing’s P-8A Multi-mission Maritime aircraft, also known as Poseidon, is a long-range anti-submarine warfare, anti-surface warfare, intelligence, surveillance and reconnaissance aircraft developed specifically for the U.S. Navy. It is also capable of executing broad-area maritime and littoral operations.

We note that Boeing witnesses a steady flow of contracts from the DoD. It is one of the major players in the defense business. Its defense business stands out among its peers by virtue of its broadly diversified programs, strong order bookings and solid backlog.

Internationally, the company is witnessing strong demand for its defense products. Amid a volatile budget environment, an increase in FMS contracts is more than welcome. In 2015, non-U.S. customers accounted for approximately 59% of Boeing’s revenues.

Boeing currently has a Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked stocks in the aerospace and defense industry include Lockheed Martin Corp. (LMT Quick QuoteLMT - Free Report) , Northrop Grumman Corp. (NOC Quick QuoteNOC - Free Report) and General Dynamics Corp. (GD Quick QuoteGD - Free Report) , each carrying a Zacks Rank #2 (Buy).

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