Raytheon Technologies Corp.’s ( RTX Quick Quote RTX - Free Report) Missiles & Defense unit recently secured a contract for hardware production of the AN/SPY-6(V) family of radars. The Naval Sea Systems Command, Washington, D.C. offered the award. Details of the Deal
Valued at $650.7 million, the contract is expected to be completed by June 2028. Options included in this deal, if exercised, will bring the cumulative value of this contract to $3.16 billion.
A major portion of the work related to this deal will be executed in Andover, MA.
Radars & Raytheon
With the rapid escalation of geopolitical tensions globally in recent times, developed and developing nations have been boosting their defense arsenal significantly. Radars constitute a vital part of this arsenal.
The demand for military radar systems has expanded manifold in recent times, driven by factors like the rise in defense spending of emerging economies, increase in regional tensions and inter-country conflicts that have boosted threats from missiles and aircraft. This in turn has been benefiting radar manufacturing companies like Raytheon, in the form of contract wins, like the latest one.
Notably, Raytheon’s product portfolio consists of varied radars like integrated air and missile defense radars, ballistic missile radars, surveillance radars as well as air dominance radars. Radars like AN-SPY 6, AN-TPY-2, APG-79, and APG-82 are some of its combat-proven products that enjoy solid demand in the global military radar market.
Per Fortune Business Insights report, the global military radar market is expected to reach $22.06 billion by 2028 at a CAGR of 6.3% from 2021. Such growth projections bode well for prominent radar manufacturers like Raytheon Technologies,
Lockheed Martin ( LMT Quick Quote LMT - Free Report) , L3Harris Technologies ( LHX Quick Quote LHX - Free Report) and Northrop Grumman ( NOC Quick Quote NOC - Free Report) .
Lockheed’s product portfolio includes various radar and electro-optical/infrared sensor systems like AN/APY-9 radar, airborne ground surveillance radar systems, the IRST21 Sensos system, AN/TPQ-53 radar systems, SPY-7, the long-range discrimination radar and a few more.
Lockheed boasts a long-term earnings growth rate of 16.3%. The Zacks Consensus Estimate for its 2022 earnings implies an improvement of 18.3% from the 2021 reported figure.
L3Harris manufactures combat-proven radars like SPS-48, land-based surveillance radar, AN/APY-11 Multimode radar, Tactical Air Surveillance radar, AN/SPS-48G Long range 3D surveillance radar and many more.
L3Harris boasts a long-term earnings growth rate of 4.4%. The Zacks Consensus Estimate for its 2022 earnings implies an improvement of 4.9% from the 2021 reported figure.
Northrop’s broad portfolio of products comprises radars like AN/APG-83 scalable agile beam radar, AN/ASQ-236 Dragon’s eye radar pod as well as AN/APG-81 and AN/APG-71 for F-35 and F-22 jets, respectively.
Northrop boasts a long-term earnings growth rate of 6.2%. The Zacks Consensus Estimate for its 2022 sales implies an improvement of 2.6% from the 2021 reported figure.
Zacks Rank and Price Performance
Raytheon currently carries a Zacks Rank #3 (Hold). You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here The company’s shares have gained 28.5% in the past year compared with the industry’s increase of 16.5%. Image Source: Zacks Investment Research