The Boeing Company ( BA Quick Quote BA - Free Report) recently secured a modification contract worth $18.4 million to support the MH-47G Chinook Block II production program. The award has been offered by the U.S. Special Operations Command, Tampa, FL.
Majority of work related to this contract will be carried out in Ridley Park, PA. Per the terms, Boeing will procure long-lead components and parts for the MH-47G Chinook Block II production program.
Importance of Chinook
Chinook Block II is a heavy-lift military rotorcraft, which combines new technologies, including the Advanced Chinook Rotor Blade, redesigned fuel tanks, a strengthened fuselage, and an improved drivetrain – all aimed at increasing lift capability.
With more than 950 Chinooks in 20 countries, the program continues to deliver unrivaled production, maintenance and sustainment cost efficiencies.
What’s Favoring Boeing?
Of the varied defense equipment that Boeing manufactures, the company’s strength lies in the development of combat-proven aircraft, such as Chinook Block II rotorcraft. Additionally, Boeing has started developing military aerial refueling and strategic transport aircraft for its fixed-wing military aircraft programs.
Being the United States’ largest jet maker and considering the latest developments in the combat aircraft section, Boeing enjoys a smooth flow of contracts for military jets and its associated upgrades. The latest contract win is an example of the same.
Such contract wins are anticipated to fuel this aerospace giant’s growth, driven by the increasing defense spending provisions made by the current U.S. administration.
It is imperative to mention in this context that the fiscal 2022 budget request submitted by President Biden reflects funding request worth $715 billion for the Department of Defense (DoD). This proposal reflects a 1.6% increase from the prior year’s enacted amount. If approved, fresh order flows from the Pentagon will boost growth prospects of Boeing.
Per a report by Mordor Intelligence firm, the global military rotorcraft market is expected to witness a CAGR of 3% during 2020-2025 period. With North America dominating this market, such projections bode well for U.S. rotorcraft-makers like Boeing,
Lockheed Martin ( LMT Quick Quote LMT - Free Report) and Textron ( TXT Quick Quote TXT - Free Report) . Price Movement
Boeing’s share price has surged 26.1% in the past year compared with the
industry’s growth of 14.7%. Image Source: Zacks Investment Research Zacks Rank & A Key Pick
Boeing currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the same
sector is Teledyne Technologies ( TDY Quick Quote TDY - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see . the complete list of today’s Zacks #1 Rank stocks here
Teledyne delivered an average earnings surprise of 10.53% in the trailing four quarters. The Zacks Consensus Estimate for 2021 earnings has improved 11.1% over the past 60 days.
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