The Boeing Company (BA Quick QuoteBA - Free Report) recently secured a $42.9-million contract to procure 48 trailing edge flaps for the F/A-18 aircraft. The contract was awarded by the Naval Air Systems Command, Patuxent River, MD.

 

Majority of the work related to this deal will be performed in St. Louis, MI, and the entire task is expected to get completed by June 2021. 

 

 

Boeing continues to witness solid demand for its fighter aircraft and major aerospace programs, including the F-18.  This is evident from a $41-million contract recently acquired by the company to provide 2,763 pieces of support  equipment, spares and test equipment for the maintenance and repair of the F/A-18E/F aircraft. Also, a couple of months back, Boeing secured a $36.8-million contract to support the F/A-18 aircraft’s Return-to-Readiness Initiative. Such contract wins are likely to augment revenues for the company.

 

 

Increasing geo-political tensions across the globe, especially the Middle East region, are prompting nations to  strengthen their defense systems manifold. Evidently, the demand for fighter jets and other critical defense products  keeps growing. Boeing, being a defense giant itself, has been benefiting from such increasing demand in the form of solid contract wins like the latest one.

 

Considering the growing demand for defense products, the Trump administration has been continuously supporting the U.S. defense sector by increasing the nation’s defense budget, with particular focus on combat aircraft. Evidently the U.S. government’s proposed fiscal 2020 defense budget includes a spending plan of $57.7 billion on aircraft, a massive  increase of 166% from the approved fiscal 2019 defense spending. If approved, this increased spending provision should usher in more contracts for Boeing’s aircraft program. 

 

 

Shares of the company have gained 6.4% in the past one year compared with the industry’s growth of 8%.

 

 

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

 

A few better-ranked stocks in the same space are Wesco Aircraft Holdings , Northrop Grumman Corp. (NOC Quick QuoteNOC - Free Report) and Textron Inc. (TXT Quick QuoteTXT - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Wesco Aircraft’s long-term growth estimates currently stand at 12%. The Zacks Consensus Estimate for 2019 earnings has increased 1.2% to 84 cents in the past 60 days.

 

Northrop Grumman came up with average positive earnings surprise of 18.50% in the last four quarters. The Zacks Consensus Estimate for 2019 earnings has increased 0.62% to $19.41 in the past 60 days.

 

Textron came up with average positive earnings surprise of 7.62% in the last four quarters. The company’s long-term growth estimates currently stand at 12.6%.

 

 

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