We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
BAE Systems (BAESY) Wins $92M Modification Deal for MK90 Grain
Read MoreHide Full Article
BAE Systems plc’s (BAESY - Free Report) business unit, Ordnance Systems, recently clinched a modification contract to supply MK90 propellant grain. Valued at $92.5 million, the contract is projected to be completed by Jun 28, 2024.
The deal has been awarded by the U.S. Army Contracting Command, Rock Island Arsenal, IL.
What’s Favoring BAE Systems?
The rise in security threats and the changing dynamics of the defense world have led to increased defense spending by nations on ordnance, ammunition and arms. In this context, defense spending on propellant grain, widely used in firearms, artillery or rocket propulsion systems mainly to provide pressure and gas volumes for projectile propulsion, has increased manifold.
Per the report from the Markets and Markets firm, the ammunition market is poised to witness a CAGR of 3.7% over the 2021-2026 period.
This stands to benefit BAE Systems as its Ordnance Systems business unit excels in manufacturing a full range of high-quality explosive and propellant products for the military. This results in multiple order inflows for the company, like the latest one, which is likely to boost its revenues from the Ordnance Systems business unit.
Peers in Focus
The expanding size of the ammunition market may provide meaningful gains for other defense majors in the industry:
General Dynamics (GD - Free Report) : Its Ordnance and Tactical Systems (“OTS”) has a long legacy of producing high-quality ammunition. OTS’ munitions manufacture Hydra-70 rockets, bomb bodies, large-caliber tank ammunition, medium-caliber ammunition, military propellants, mortar and artillery projectiles.
General Dynamics has a long-term earnings growth rate of 8.9%. Its investors have gained 2.8% in the past month.
Lockheed Martin (LMT - Free Report) : It is a leader in providing vertical launching systems and munitions for the Navy, with products such as the MK 41, the Single-Cell Launcher, the Extensible Launching System and the Vertical Launch Anti-Submarine Rocket.
Lockheed Martin’s long-term earnings growth rate is 6.2%. Shares of LMT have returned 6.2% value to investors in the past year.
RaytheonTechnologies (RTX - Free Report) : Its leading-edge defense systems, capabilities and technologies excel in providing shoulder-fired weapons to extended-range precision munitions. TOW Weapon Systems, Javelin and Excalibur are some of its exclusive product ranges.
RTX boasts a long-term earnings growth rate of 8.3%. In the past month, shares of Raytheon Technologies have increased 2.3%.
Price Movement
In the past year, shares of BAE Systems have rallied 16.6% compared with the industry’s growth of 8.9%.
Image: Bigstock
BAE Systems (BAESY) Wins $92M Modification Deal for MK90 Grain
BAE Systems plc’s (BAESY - Free Report) business unit, Ordnance Systems, recently clinched a modification contract to supply MK90 propellant grain. Valued at $92.5 million, the contract is projected to be completed by Jun 28, 2024.
The deal has been awarded by the U.S. Army Contracting Command, Rock Island Arsenal, IL.
What’s Favoring BAE Systems?
The rise in security threats and the changing dynamics of the defense world have led to increased defense spending by nations on ordnance, ammunition and arms. In this context, defense spending on propellant grain, widely used in firearms, artillery or rocket propulsion systems mainly to provide pressure and gas volumes for projectile propulsion, has increased manifold.
Per the report from the Markets and Markets firm, the ammunition market is poised to witness a CAGR of 3.7% over the 2021-2026 period.
This stands to benefit BAE Systems as its Ordnance Systems business unit excels in manufacturing a full range of high-quality explosive and propellant products for the military. This results in multiple order inflows for the company, like the latest one, which is likely to boost its revenues from the Ordnance Systems business unit.
Peers in Focus
The expanding size of the ammunition market may provide meaningful gains for other defense majors in the industry:
General Dynamics (GD - Free Report) : Its Ordnance and Tactical Systems (“OTS”) has a long legacy of producing high-quality ammunition. OTS’ munitions manufacture Hydra-70 rockets, bomb bodies, large-caliber tank ammunition, medium-caliber ammunition, military propellants, mortar and artillery projectiles.
General Dynamics has a long-term earnings growth rate of 8.9%. Its investors have gained 2.8% in the past month.
Lockheed Martin (LMT - Free Report) : It is a leader in providing vertical launching systems and munitions for the Navy, with products such as the MK 41, the Single-Cell Launcher, the Extensible Launching System and the Vertical Launch Anti-Submarine Rocket.
Lockheed Martin’s long-term earnings growth rate is 6.2%. Shares of LMT have returned 6.2% value to investors in the past year.
RaytheonTechnologies (RTX - Free Report) : Its leading-edge defense systems, capabilities and technologies excel in providing shoulder-fired weapons to extended-range precision munitions. TOW Weapon Systems, Javelin and Excalibur are some of its exclusive product ranges.
RTX boasts a long-term earnings growth rate of 8.3%. In the past month, shares of Raytheon Technologies have increased 2.3%.
Price Movement
In the past year, shares of BAE Systems have rallied 16.6% compared with the industry’s growth of 8.9%.
Image Source: Zacks Investment Research
Zacks Rank
BAE Systems currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.