On Sep 27, 2013, the U.S. Department of Defense (DoD) disbursed 113 separate contracts worth $10.92 billion with Northrop Grumman Corp. (NOC - Free Report) winning 10 or approximately 9% of the total contracts awarded.
The company received a sizeable $795.9 million modification contract to provide logistics support to Air Mobility Command aircraft at several stateside airbases. The contract runs through Sept. 30, 2015.
Per the second contract, the company will design, develop, build, integrate, furnish, evaluate and support an In-flight Refueling-Capable E-2D Advanced Hawkeye airborne early warning aircraft for the U.S. Navy. This cost-plus-incentive-fee contract worth $226.7 million is scheduled to be completed by Jan 2019.
The third contract worth $114.2 million calls for the company to purchase long-lead items needed to build three Low Rate Initial Production Lot 11 Block 30 Global Hawk drones. The contract is scheduled to be completed by Feb 28, 2015.
The seven remaining contracts though small in value will add to the top line of the company. Per a $36.8 million contract, the company will continue to run on-orbit operations and sustainment for Missile Defense Agency Space Tracking and Surveillance Systems from Oct 2013 through Mar 2015. A firm-fixed-price contract worth $28.1 million calls for the company to supply the Air Force with aircraft aft deck structural supports by Nov 30, 2017.
Other wins included a contract to support the C-130 Direct Sales Public-Private Partnership through Sep 26, 2014; a contract to support Defense Support Program spacecraft and sensors in orbit, as well as to support and give in-depth missile threat analysis on-site to the Space and Missile Systems Center's 2nd Space Warning Squadron through Sep 30, 2014 and a contract to provide engineering and software sustainment services to the U.S. Navy in support of Navy MQ-8B Fire Scout unmanned helicopters through Jun 2014.
A contract calls for the company to support the AN/TYQ-23(V)4 Tactical Air Operations Module, AN/TYQ-87(V)2 Sector Anti-Air Warfare Facility, Tactical Air Operations Module Interface Group, Multi-Radar Tracker, Multi-Channel Interface Unit, and critical components of the AN/TSQ-269 Mobile Tactical Air Operations Module and provide other support services to the U.S. Marine Corps through Sep 26, 2014. Per the final contract, the company will maintain and upgrade AN/APG-68 radar systems on Air Force Block 30 F-16 fighter aircraft.
Despite the threat of sequestration, we note that defense players like Northrop Grumman, Lockheed Martin Corp. (LMT - Free Report) , Raytheon Co. (RTN - Free Report) and The Boeing Co. (BA - Free Report) have continued to receive small as well as sizeable contracts. Indeed, the latest handout from the DoD worth $10.92 billion is approximately equal to two weeks' worth of contracts at any other time of the year. Contract wins are gathering pace as the DoD fiscal year draws to a close.
Northrop, Raytheon and Lockheed Martin presently have a short-term Zacks Rank #2 (Buy).