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Boeing (BA) Secures Deal to Aid F/A-18 & EA-18G Aircraft
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The Boeing Company (BA - Free Report) recently clinched a contract for its F/A-18 and E/A-18G aircraft. The award has been provided by the Naval Air Warfare Center Aircraft Division, Patuxent River, MD.
Details of the Deal
Valued at $56.4 million, the contract is expected to be completed in April 2029. Per the terms of the deal, Boeing will provide flight test assets, including engineering, instrumentation and maintenance of the F/A-18 A-F and EA-18G aircraft. It is also responsible for the required laboratories, machine and metal shops, tooling, tool cribs, aircraft parts, aircraft ancillary equipment and support equipment.
Work related to this deal will be performed at Patuxent River, MD.
What’s Favoring Boeing?
Of late, military aircraft have been gaining prominence and significant traction globally due to the advancements of new tactical, logistical and other important features along with the ongoing conflicts.
To this end, it is imperative to mention that Boeing’s F/A-18 Block III Super Hornet, the backbone of the U.S. Navy, is a highly capable and affordable tactical aircraft. The EA-18G Growler, a variant of the F/A-18F, provides critical electronic intelligence, surveillance and reconnaissance data to other joint force aircraft. In 2023, Boeing successfully delivered 22 F/A-18 models, from which one can gauge the solid demand that these jets enjoy in the combat aircraft market.
The latest contract win is another testament to that. Such contract wins tend to boost the company’s operating results from the Boeing Defense, Space & Security (BDS) segment, which witnessed an 8% yearly improvement in 2023.
Growth Prospects
Per a report from Mordor Intelligence, the global military aviation market is estimated to witness a CAGR of 5.23% in the 2024-2030 period.
Such projections indicate immense opportunities for Boeing to reap the benefits of military aviation market expansion. The company’s product portfolio includes a range of combat-proven aircraft like the P-8, F-15, C-17 Globemaster III and T-7A Red Hawk, apart from F/A-18 and EA-18G. In 2023, Boeing delivered 9 F-15s, 3 T-7A Red Hawk and 11 P-8 models. The BDS unit had a backlog of $59.01 billion as of Dec 31, 2023.
Opportunities for Peers
A few other defense players that can gain from the growing military aviation market are Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Airbus Group (EADSY - Free Report) .
Northrop Grumman has built some of the world’s most advanced combat aircraft, ranging from the innovative B-2 Spirit stealth bomber to the game-changing E-2D Advanced Hawkeye. The Aeronautics segment witnessed a higher volume of restricted programs as well as the Triton and E-2 programs in 2023. It ended 2023 with a solid backlog of $19.58 billion.
NOC boasts a long-term (three-to-five years) earnings growth rate of 10.1%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 4.6% from the 2023 reported figure.
Lockheed is one of the pioneers in the combat aircraft space, with its product portfolio constituting some of the most advanced military aircraft like the F-35, C-130J Super Hercules, F-16 Fighting Falcon, F-22 Raptor and a few more. The F-35 Lightning II, an international multi-role stealth fighter, comprised 64% of the Aeronautics segment’s total sales. The unit witnessed a 2% increase in 2023 sales due to the ramp-up of the F-16 and other classified programs.
LMT boasts a long-term earnings growth rate of 4.2%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 2.7% from the 2023 reported figure.
Airbus Group’s military aircraft consists of the A400M, the C295 tactical transporter, the new-generation A330 Multi Role Tanker Transport and the Eurofighter, the most advanced swing-role fighter ever conceived. Along with this, Airbus provides world-class customer support. As of Mar 31, 2024, Airbus delivered 1,783 aircraft globally.
EADSY boasts a long-term earnings growth rate is 12.4%. The Zacks Consensus Estimate for 2024 sales implies growth of 9.5% from the 2023 reported figure.
Price Performance
In the past month, shares of BA have lost 6% compared with the industry’s 7.9% decline.
Image Source: Zacks Investment Research
Zacks Rank
Boeing currently has a Zacks Rank #5 (Strong Sell).
Image: Bigstock
Boeing (BA) Secures Deal to Aid F/A-18 & EA-18G Aircraft
The Boeing Company (BA - Free Report) recently clinched a contract for its F/A-18 and E/A-18G aircraft. The award has been provided by the Naval Air Warfare Center Aircraft Division, Patuxent River, MD.
Details of the Deal
Valued at $56.4 million, the contract is expected to be completed in April 2029. Per the terms of the deal, Boeing will provide flight test assets, including engineering, instrumentation and maintenance of the F/A-18 A-F and EA-18G aircraft. It is also responsible for the required laboratories, machine and metal shops, tooling, tool cribs, aircraft parts, aircraft ancillary equipment and support equipment.
Work related to this deal will be performed at Patuxent River, MD.
What’s Favoring Boeing?
Of late, military aircraft have been gaining prominence and significant traction globally due to the advancements of new tactical, logistical and other important features along with the ongoing conflicts.
To this end, it is imperative to mention that Boeing’s F/A-18 Block III Super Hornet, the backbone of the U.S. Navy, is a highly capable and affordable tactical aircraft. The EA-18G Growler, a variant of the F/A-18F, provides critical electronic intelligence, surveillance and reconnaissance data to other joint force aircraft. In 2023, Boeing successfully delivered 22 F/A-18 models, from which one can gauge the solid demand that these jets enjoy in the combat aircraft market.
The latest contract win is another testament to that. Such contract wins tend to boost the company’s operating results from the Boeing Defense, Space & Security (BDS) segment, which witnessed an 8% yearly improvement in 2023.
Growth Prospects
Per a report from Mordor Intelligence, the global military aviation market is estimated to witness a CAGR of 5.23% in the 2024-2030 period.
Such projections indicate immense opportunities for Boeing to reap the benefits of military aviation market expansion. The company’s product portfolio includes a range of combat-proven aircraft like the P-8, F-15, C-17 Globemaster III and T-7A Red Hawk, apart from F/A-18 and EA-18G. In 2023, Boeing delivered 9 F-15s, 3 T-7A Red Hawk and 11 P-8 models. The BDS unit had a backlog of $59.01 billion as of Dec 31, 2023.
Opportunities for Peers
A few other defense players that can gain from the growing military aviation market are Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Airbus Group (EADSY - Free Report) .
Northrop Grumman has built some of the world’s most advanced combat aircraft, ranging from the innovative B-2 Spirit stealth bomber to the game-changing E-2D Advanced Hawkeye. The Aeronautics segment witnessed a higher volume of restricted programs as well as the Triton and E-2 programs in 2023. It ended 2023 with a solid backlog of $19.58 billion.
NOC boasts a long-term (three-to-five years) earnings growth rate of 10.1%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 4.6% from the 2023 reported figure.
Lockheed is one of the pioneers in the combat aircraft space, with its product portfolio constituting some of the most advanced military aircraft like the F-35, C-130J Super Hercules, F-16 Fighting Falcon, F-22 Raptor and a few more. The F-35 Lightning II, an international multi-role stealth fighter, comprised 64% of the Aeronautics segment’s total sales. The unit witnessed a 2% increase in 2023 sales due to the ramp-up of the F-16 and other classified programs.
LMT boasts a long-term earnings growth rate of 4.2%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 2.7% from the 2023 reported figure.
Airbus Group’s military aircraft consists of the A400M, the C295 tactical transporter, the new-generation A330 Multi Role Tanker Transport and the Eurofighter, the most advanced swing-role fighter ever conceived. Along with this, Airbus provides world-class customer support. As of Mar 31, 2024, Airbus delivered 1,783 aircraft globally.
EADSY boasts a long-term earnings growth rate is 12.4%. The Zacks Consensus Estimate for 2024 sales implies growth of 9.5% from the 2023 reported figure.
Price Performance
In the past month, shares of BA have lost 6% compared with the industry’s 7.9% decline.
Image Source: Zacks Investment Research
Zacks Rank
Boeing currently has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.