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Huntington Ingalls (HII) Secures Deals Worth $393M for CVN 79
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Huntington Ingalls Industries Inc.’s (HII - Free Report) business unit, Newport News, secured a couple of contracts involving John F. Kennedy (CVN 79) aircraft carrier. The awards have been offered by the Naval Sea Systems Command, Washington, D.C.
The contracts, worth $393.2 million, are projected to be completed by Jul 31, 2025. Per the terms of the deals, Huntington Ingalls will be responsible for improving capability at ship delivery, defining unpriced change orders, and providing engineering and integrated logistics support for Pre-Commissioning Unit John F. Kennedy (CVN 79) aircraft carrier.
Work related to these contracts will be carried out in Newport News, VA.
Aircraft Carriers & Huntington Ingalls
Huntington Ingalls’ Newport News unit is an expert in engineering, design and construction of U.S. Navy nuclear aircraft carriers (CVN). These CVNs are the largest ships in the U.S. Navy's fleet, with a displacement of more than 90,000 tons.
The unit has designed and built the first next generation ship — Gerald R. Ford class (CVN 78) aircraft carriers — and over 31 aircraft carriers for the U.S. Navy since 1933, including all 10 Nimitz class (CVN 68) aircraft carriers currently in service.
It continues to be the exclusive prime contractor for nuclear aircraft carrier refueling and complex overhaul (RCOH), with Huntington Ingalls being the sole designer and builder of nuclear-powered aircraft carriers. Newport News is currently performing the RCOH of USS George Washington (CVN 73) and USS John C. Stennis (CVN 74).
The aforementioned discussion reflects the solid position that Huntington Ingalls already enjoys in the nuclear aircraft carrier market. The company witnesses a strong inflow of contracts involving the production, RCOH and related support for CVNs. The latest contract wins are a bright example of that, taking HII a step closer to the scheduled delivery of CVN 79 in 2025.
Looking Ahead
Nations are strengthening their defense capabilities amid rising geopolitical tensions. In this context, demand for military ships that boast the features of next-generation technology-based warfare capabilities, has been gaining momentum. This is due to the system’s growing importance in military missions.
Per a report from Mordor Intelligence, the aircraft carrier ship market is projected to witness a CAGR of more than 2% during 2023-2028. Such solid growth trends indicate ample growth opportunities for Huntington Ingalls, as it enjoys the lucrative position of a prominent aircraft carrier in the aforementioned market.
A few defense primes that can gain from the expanding aircraft carrier market are General Dynamics (GD - Free Report) , BAE Systems (BAESY - Free Report) and Lockheed Martin (LMT - Free Report) .
General Dynamics’ NASSCO-Norfolk, a consolidation of two great shipyards, is a Master Ship Repair contractor providing high-quality and cost-effective maintenance and modernization for the U.S. Navy. With facilities in Bremerton, WA, in the Pacific Northwest, GD holds experience in more than 450 ships, a Master Ship Repair Agreement contract, and the maintenance and repair of aircraft carriers from the Navy's amphibious fleet.
GD boasts a long-term earnings growth rate of 8.9%. The Zacks Consensus Estimate for General Dynamics’ 2023 sales indicates an improvement of 5% from the 2022 reported figure.
BAE Systems designs and manufactures naval ships as well as state-of-the-art combat systems and equipment supporting those warships. The company played a key role in the design and construction of the Queen Elizabeth Class Aircraft Carriers, the largest warship in the United Kingdom. It also provides management and delivery of planned overseas support to the Queen Elizabeth aircraft carrier.
BAESY boasts a long-term earnings growth rate of 13.7%. The Zacks Consensus Estimate for the company’s 2023 sales indicates growth of 24.8% from the previous year’s reported number.
Lockheed’s Surface Electronic Warfare Improvement Program Block 2 systems are used to upgrade warships like aircraft carriers’ electronic warfare capabilities so that warfighters can respond to evolving threats. The company also offers upgrade to the AN/SLQ-32 systems on U.S. aircraft carriers to determine if the electronic sensors of its potential foes are tracking the ship.
LMT boasts a long-term earnings growth rate of 6.2%. The company delivered an average four-quarter earnings surprise of 7.46%.
Price Performance
Shares of Huntington Ingalls have lost 4.7% in the past six months compared with the industry’s 8% decline.
Image: Bigstock
Huntington Ingalls (HII) Secures Deals Worth $393M for CVN 79
Huntington Ingalls Industries Inc.’s (HII - Free Report) business unit, Newport News, secured a couple of contracts involving John F. Kennedy (CVN 79) aircraft carrier. The awards have been offered by the Naval Sea Systems Command, Washington, D.C.
The contracts, worth $393.2 million, are projected to be completed by Jul 31, 2025. Per the terms of the deals, Huntington Ingalls will be responsible for improving capability at ship delivery, defining unpriced change orders, and providing engineering and integrated logistics support for Pre-Commissioning Unit John F. Kennedy (CVN 79) aircraft carrier.
Work related to these contracts will be carried out in Newport News, VA.
Aircraft Carriers & Huntington Ingalls
Huntington Ingalls’ Newport News unit is an expert in engineering, design and construction of U.S. Navy nuclear aircraft carriers (CVN). These CVNs are the largest ships in the U.S. Navy's fleet, with a displacement of more than 90,000 tons.
The unit has designed and built the first next generation ship — Gerald R. Ford class (CVN 78) aircraft carriers — and over 31 aircraft carriers for the U.S. Navy since 1933, including all 10 Nimitz class (CVN 68) aircraft carriers currently in service.
It continues to be the exclusive prime contractor for nuclear aircraft carrier refueling and complex overhaul (RCOH), with Huntington Ingalls being the sole designer and builder of nuclear-powered aircraft carriers. Newport News is currently performing the RCOH of USS George Washington (CVN 73) and USS John C. Stennis (CVN 74).
The aforementioned discussion reflects the solid position that Huntington Ingalls already enjoys in the nuclear aircraft carrier market. The company witnesses a strong inflow of contracts involving the production, RCOH and related support for CVNs. The latest contract wins are a bright example of that, taking HII a step closer to the scheduled delivery of CVN 79 in 2025.
Looking Ahead
Nations are strengthening their defense capabilities amid rising geopolitical tensions. In this context, demand for military ships that boast the features of next-generation technology-based warfare capabilities, has been gaining momentum. This is due to the system’s growing importance in military missions.
Per a report from Mordor Intelligence, the aircraft carrier ship market is projected to witness a CAGR of more than 2% during 2023-2028. Such solid growth trends indicate ample growth opportunities for Huntington Ingalls, as it enjoys the lucrative position of a prominent aircraft carrier in the aforementioned market.
A few defense primes that can gain from the expanding aircraft carrier market are General Dynamics (GD - Free Report) , BAE Systems (BAESY - Free Report) and Lockheed Martin (LMT - Free Report) .
General Dynamics’ NASSCO-Norfolk, a consolidation of two great shipyards, is a Master Ship Repair contractor providing high-quality and cost-effective maintenance and modernization for the U.S. Navy. With facilities in Bremerton, WA, in the Pacific Northwest, GD holds experience in more than 450 ships, a Master Ship Repair Agreement contract, and the maintenance and repair of aircraft carriers from the Navy's amphibious fleet.
GD boasts a long-term earnings growth rate of 8.9%. The Zacks Consensus Estimate for General Dynamics’ 2023 sales indicates an improvement of 5% from the 2022 reported figure.
BAE Systems designs and manufactures naval ships as well as state-of-the-art combat systems and equipment supporting those warships. The company played a key role in the design and construction of the Queen Elizabeth Class Aircraft Carriers, the largest warship in the United Kingdom. It also provides management and delivery of planned overseas support to the Queen Elizabeth aircraft carrier.
BAESY boasts a long-term earnings growth rate of 13.7%. The Zacks Consensus Estimate for the company’s 2023 sales indicates growth of 24.8% from the previous year’s reported number.
Lockheed’s Surface Electronic Warfare Improvement Program Block 2 systems are used to upgrade warships like aircraft carriers’ electronic warfare capabilities so that warfighters can respond to evolving threats. The company also offers upgrade to the AN/SLQ-32 systems on U.S. aircraft carriers to determine if the electronic sensors of its potential foes are tracking the ship.
LMT boasts a long-term earnings growth rate of 6.2%. The company delivered an average four-quarter earnings surprise of 7.46%.
Price Performance
Shares of Huntington Ingalls have lost 4.7% in the past six months compared with the industry’s 8% decline.
Image Source: Zacks Investment Research
Zacks Rank
Huntington Ingalls currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.