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Bell-Boeing JV Wins $46M Contract to Upgrade MV-22 Program

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Bell-Boeing, a joint venture (JV) between The Boeing Company (BA - Free Report) and Bell Helicopter — a unit of Textron Inc. (TXT - Free Report) , recently secured a modification contract for supporting the V-22 Common Configuration-Readiness and Modernization (CC-RAM) effort. The deal also entails upgrade of three MV-22 aircraft from a Block B to Block C configuration.

Valued at $46.1 million, the contract was awarded by the Naval Air Systems Command, Patuxent River, MD. Work related to the deal is scheduled to be completed by March 2022.

Jet Demand & V-22 Jets

A rapid increase in terror attacks has compelled nations to strengthen their arsenal and bump up defense budget. With the United States being the largest exporter of defense equipment across the world, the nation enjoys a steady flow of contracts for its combat-proven weaponries from both Pentagon and its foreign allies. With military jets and helicopters constituting a major portion of a nation’s armaments, there is a steady flow of contracts for these weaponries.

Notably, Bell-Boeing’s primary product, V-22 Osprey is a family of multi-mission, tiltrotor military aircraft with both vertical as well as short takeoff and landing capabilities. It is designed to combine the functionality of a conventional helicopter with long-range, high-speed cruise performance of a turboprop aircraft. Notably, MV-22 and CV-22 are two variants of the V-22 family of jets.

Apart from its wide usage domestically, this family of tiltrotors has been deployed in numerous missions overseas including casualty evacuation, tactical recovery of aircraft and personnel, humanitarian assistance/disaster relief, resupply, VIP transport along with theater security cooperation. No doubt with growing demand for military aircraft these tiltrotors enjoy decent demand across the globe, which is evident from the latest contract win. Such contract wins in turn tend to boost the operational performance of Bell-Boeing JV.

Looking Ahead

Per a forecast made by Fortune Business Insights, the global military aircraft market size is projected to reach $58 billion by 2026 from 2018 at a CAGR of 3.1%. This surely is going to benefit major U.S. combat aircraft manufacturers like Bell-Boeing, Lockheed (LMT - Free Report) and Northrop Grumman (NOC - Free Report) with North America dominating this market space.

Price Movement & Zacks Rank

Textron’s stock has lost 24.9% in the past year compared with the industry’s decline of 36.3%.



Boeing’s shares have lost 56.3% in the past year compared with the industry’s decline of 36.3%.

 

While Textron currently carries a Zacks Rank #3 (Hold), Boeing has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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