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Boeing (BA) Wins $471M Deal to Modify Japan's F-15 Jets
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The Boeing Company (BA - Free Report) recently clinched a contract to support the modification of the F-15MJ aircraft for the Japan Air Self Defense Force. The award has been offered by the Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, OH.
Details of the Deal
Valued at $471.3 million, the contract is expected to be completed by Dec 31, 2028. Per the deal terms, Boeing will develop, test and deliver four Weapon System Trainers.
Work related to the deal will be executed in St. Louis, MO.
Rising Demand for Military Jets & Boeing
With the rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending rapidly to enhance their defense arsenals. Contrarily, developed nations like the United States and Europe have already been leading the defense market.
It is imperative to mention in this context that military aircraft, both manned and unmanned, forms an integral part of a country’s defense products. It is to be noted that the emerging trends in the combat aircraft space like fifth-generation technology aircraft, advanced composite materials and stealth technology have been substantially driving demand for military jets.
The global military jet market is expanding manifold, with North America leading this space. Boeing, being the largest jet maker in the United States, enjoys a dominant position. The company thus enjoys a frequent flow of contracts for military jets and associated upgrades. The latest contract win is a bright example.
Prospects
With rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending a lot on enhancing their defense arsenals. Meanwhile, developed nations like the United States and Europe have already been leading the defense market. With the United States being the largest weapon exporter worldwide, the nation has been spending generously on defense products, wherein the combat aircraft enjoys one of the dominating positions. Boeing, being the largest aircraft manufacturer in the United States, thus enjoys a dominant position in the combat aircraft market.
Per a Mordor Intelligence report, the global combat aircraft market is expected to witness a CAGR of 2.5% during the 2021-2026 time period, with North America constituting the largest share of this market. Such growth can be attributed to a rise in global threats and geopolitical instabilities as well as increased spending on defense. This should benefit Boeing along with other U.S.-based combat jet manufacturers like Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Textron (TXT - Free Report) .
Lockheed’s Aeronautics business segment is engaged in the research, design, development, manufacture, integration, sustainment, support and upgrade of advanced military aircraft, including combat and air mobility aircraft, unmanned air vehicles, and related technologies. Its major programs include F-35, C-130 Hercules, F-16 Fighting Falcon and F-22 Raptor jets.
Lockheed Martin reported third-quarter 2021 adjusted earnings of $6.66 per share, which surpassed the Zacks Consensus Estimate by a whopping 239.8%. LMT stock has gained 41.5% in the past five years.
Since its inception, Northrop Grumman has been a pioneer in the development of manned aircraft for combat. Northrop Grumman also has a tradition of providing technological leadership in all aspects of military aviation and aircraft such as manned, unmanned, targeting, surveillance, and aircraft self-protection systems that enable warfighters to accomplish missions anytime, anywhere, and under any conditions.
Northrop Grumman reported third-quarter 2021 earnings of $6.63 per share, which surpassed the Zacks Consensus Estimate of $5.93 by 11.8%. NOC stock has gained 66.3% in the past five years.
Textron’s business unit, Textron Aviation Defense designs, builds and supports versatile and globally known military aircraft preferred for training and attack missions. Some of Textron’s renowned products include Beechcraft T-6C trainer and AT-6 Wolverine.
Textron reported third-quarter 2021 adjusted earnings of 85 cents per share, which outpaced the Zacks Consensus Estimate of 75 cents by 13.3%. TXT stock has gained 58.9% in the past five years.
Price Movement
Shares of Boeing have lost 5.3% in the past 12 months compared with the industry’s 30.5% decline.
Image: Bigstock
Boeing (BA) Wins $471M Deal to Modify Japan's F-15 Jets
The Boeing Company (BA - Free Report) recently clinched a contract to support the modification of the F-15MJ aircraft for the Japan Air Self Defense Force. The award has been offered by the Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, OH.
Details of the Deal
Valued at $471.3 million, the contract is expected to be completed by Dec 31, 2028. Per the deal terms, Boeing will develop, test and deliver four Weapon System Trainers.
Work related to the deal will be executed in St. Louis, MO.
Rising Demand for Military Jets & Boeing
With the rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending rapidly to enhance their defense arsenals. Contrarily, developed nations like the United States and Europe have already been leading the defense market.
It is imperative to mention in this context that military aircraft, both manned and unmanned, forms an integral part of a country’s defense products. It is to be noted that the emerging trends in the combat aircraft space like fifth-generation technology aircraft, advanced composite materials and stealth technology have been substantially driving demand for military jets.
The global military jet market is expanding manifold, with North America leading this space. Boeing, being the largest jet maker in the United States, enjoys a dominant position. The company thus enjoys a frequent flow of contracts for military jets and associated upgrades. The latest contract win is a bright example.
Prospects
With rising security threats across the globe, emerging economies like the Asia Pacific, the Middle East and South America are spending a lot on enhancing their defense arsenals. Meanwhile, developed nations like the United States and Europe have already been leading the defense market. With the United States being the largest weapon exporter worldwide, the nation has been spending generously on defense products, wherein the combat aircraft enjoys one of the dominating positions. Boeing, being the largest aircraft manufacturer in the United States, thus enjoys a dominant position in the combat aircraft market.
Per a Mordor Intelligence report, the global combat aircraft market is expected to witness a CAGR of 2.5% during the 2021-2026 time period, with North America constituting the largest share of this market. Such growth can be attributed to a rise in global threats and geopolitical instabilities as well as increased spending on defense. This should benefit Boeing along with other U.S.-based combat jet manufacturers like Northrop Grumman (NOC - Free Report) , Lockheed Martin (LMT - Free Report) and Textron (TXT - Free Report) .
Lockheed’s Aeronautics business segment is engaged in the research, design, development, manufacture, integration, sustainment, support and upgrade of advanced military aircraft, including combat and air mobility aircraft, unmanned air vehicles, and related technologies. Its major programs include F-35, C-130 Hercules, F-16 Fighting Falcon and F-22 Raptor jets.
Lockheed Martin reported third-quarter 2021 adjusted earnings of $6.66 per share, which surpassed the Zacks Consensus Estimate by a whopping 239.8%. LMT stock has gained 41.5% in the past five years.
Since its inception, Northrop Grumman has been a pioneer in the development of manned aircraft for combat. Northrop Grumman also has a tradition of providing technological leadership in all aspects of military aviation and aircraft such as manned, unmanned, targeting, surveillance, and aircraft self-protection systems that enable warfighters to accomplish missions anytime, anywhere, and under any conditions.
Northrop Grumman reported third-quarter 2021 earnings of $6.63 per share, which surpassed the Zacks Consensus Estimate of $5.93 by 11.8%. NOC stock has gained 66.3% in the past five years.
Textron’s business unit, Textron Aviation Defense designs, builds and supports versatile and globally known military aircraft preferred for training and attack missions. Some of Textron’s renowned products include Beechcraft T-6C trainer and AT-6 Wolverine.
Textron reported third-quarter 2021 adjusted earnings of 85 cents per share, which outpaced the Zacks Consensus Estimate of 75 cents by 13.3%. TXT stock has gained 58.9% in the past five years.
Price Movement
Shares of Boeing have lost 5.3% in the past 12 months compared with the industry’s 30.5% decline.
Zacks Rank
Boeing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.