The Department of Defense ("DoD") handed out a string of defense contracts totaling $1.2 billion on Tuesday. The DoD awarded 20 individual contracts of which a quarter went to the biggest winner Lockheed Martin Corp. (LMT - Free Report) .
The company secured a lofty $308.3 million foreign military sales ("FMS') contract for the continued delivery of tactical missiles and launcher modification kits to Kuwait military forces. The tasks related to this contract will be carried out in Grand Prairie, Lufkin and El Paso, Texas; Camden, Ark.; Chelmsford, Mass.; Ocala, Fla.; Huntsville, Ala.; and Anaheim, Calif.
Apart from this, Lockheed also received three more modification contracts of a sum of $108.7 million. The first – a $37.4 million FMS contract – supports cost reductions at the improved launcher electronic station servicing Patriot air defense missile systems in the United Arab Emirate.
The second comprised a $35.7 million contract for providing information technology solutions to the DoD and National Capital Region. The final contract valued at $35.6 million involved upgrading the fire control system of Lockheed’s M270A1 Multiple Launch Rocket System.
Lockheed has been flooded with an array of contracts in the last few months thanks to its diversified operations focusing on ISR, unmanned systems, force protection, cyber security, and missile defense. Worth mentioning is the $209.0 million DoD contract for the supply of additional AN/TPQ-53 radar systems and corresponding spare parts. This is expected to increase the total value of the contract to $605 million.
In addition, the steady flow of international orders will lend constancy to the company's earnings stream amidst the defense budget crunch. We believe Lockheed’s varied operational capabilities will allow it to win more orders in the upcoming quarters.
The Bethesda, Md. based company currently carries a Zacks Rank #3 (Hold). Other defense majors which collected sizeable DoD contracts are Boeing Company (BA - Free Report) , Northrop Grumman Corp. (NOC - Free Report) and Raytheon Company (RTN - Free Report) .