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Lockheed (LMT) Wins $622M Deal for F-35 Fighter Aircraft
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Lockheed Martin Corp. (LMT - Free Report) recently clinched a contract to provide program management, non-recurring unique requirements and training for supporting the integration efforts of the F-35 Joint Strike Fighter program. The contract will serve the government of Germany under Foreign Military Sales.
The deal has been awarded by the Naval Air Systems Command, Patuxent River, MD. Valued at $622.4 million, the contract is expected to be complete by December 2027. The majority of the work related to this deal will be carried out in Fort Worth, TX.
What’s Favoring Lockheed Martin?
Lockheed has a significant presence in the global military aircraft sector, largely due to its F-35 Lightning II fleet. The jet is considered to be one of the most advanced and versatile aircraft, and due to its diverse capabilities in air warfare, ground attack and reconnaissance, it enjoys strong and consistent demand worldwide. The latest contract win is a bright example of that.
Considering the solid demand for this multi-variant stealth aircraft, the F-35 Lightning II fleet is the major contributor to LMT’s Aeronautics business segment. Its strong demand can also be gauged from its delivery numbers. In the second quarter of 2023, LMT delivered 45 aircraft and ended the quarter with a backlog of 421 aircraft.
LMT’s continuous efforts to upgrade the model to match the evolving needs of military missions are likely to result in a steady inflow of orders for the company, like the latest one. Going forward, the company expects to deliver between 100 and 120 aircraft in 2023. This should continue to boost LMT’s revenues in the days ahead.
Peer Prospects
Per the report from the Coherent Market Insights firm, the global military aircraft market is poised to witness a CAGR of 5.4% over the 2022-2030 period. This should benefit Lockheed as the company enjoys a dominant position in the military aircraft market with its portfolio containing combat-proven jets like F-16 and F-35 Fighter Aircraft.
Other defense companies that may enjoy the perks of the expanding military aircraft market are as follows:
Boeing (BA - Free Report) : The company is a prominent jet maker and enjoys a dominant position in the combat aircraft market. Its expertise lies in a wide variety of defense aircraft and jet components, repair and modification-related programs. Its military aircraft include C-17 Globemaster III, P-8A Poseidon, V-22 Osprey, etc.
Boeing has a long-term earnings growth rate of 4%. Its investors have gained 37.8% in the past year.
Airbus Group (EADSY - Free Report) : Its military aircraft consist of the A400M, the C295 tactical transporter, the new-generation A330 Multi Role Tanker Transport and the Eurofighter, the most advanced swing-role fighter ever conceived.
Airbus’ long-term earnings growth rate is pegged at 12.4%. Shares of EADSY have returned 29.7% value to its investors in the past year.
Textron (TXT - Free Report) : Its military aircraft includes the Beechcraft T-6 training aircraft and the Beechcraft AT-6 light-attack aircraft. The company also manufactures the Beechcraft Model 18 light bomber, the T-44 and T-34 training aircraft and the T-1A jet trainer.
Textron boasts a long-term earnings growth rate of 11.7%. TXT stock has appreciated 13.1% in the past year.
Price Movement
In the past year, shares of Lockheed Martin have increased 1.5% against the industry’s fall of 8.3%.
Image: Bigstock
Lockheed (LMT) Wins $622M Deal for F-35 Fighter Aircraft
Lockheed Martin Corp. (LMT - Free Report) recently clinched a contract to provide program management, non-recurring unique requirements and training for supporting the integration efforts of the F-35 Joint Strike Fighter program. The contract will serve the government of Germany under Foreign Military Sales.
The deal has been awarded by the Naval Air Systems Command, Patuxent River, MD. Valued at $622.4 million, the contract is expected to be complete by December 2027. The majority of the work related to this deal will be carried out in Fort Worth, TX.
What’s Favoring Lockheed Martin?
Lockheed has a significant presence in the global military aircraft sector, largely due to its F-35 Lightning II fleet. The jet is considered to be one of the most advanced and versatile aircraft, and due to its diverse capabilities in air warfare, ground attack and reconnaissance, it enjoys strong and consistent demand worldwide. The latest contract win is a bright example of that.
Considering the solid demand for this multi-variant stealth aircraft, the F-35 Lightning II fleet is the major contributor to LMT’s Aeronautics business segment. Its strong demand can also be gauged from its delivery numbers. In the second quarter of 2023, LMT delivered 45 aircraft and ended the quarter with a backlog of 421 aircraft.
LMT’s continuous efforts to upgrade the model to match the evolving needs of military missions are likely to result in a steady inflow of orders for the company, like the latest one. Going forward, the company expects to deliver between 100 and 120 aircraft in 2023. This should continue to boost LMT’s revenues in the days ahead.
Peer Prospects
Per the report from the Coherent Market Insights firm, the global military aircraft market is poised to witness a CAGR of 5.4% over the 2022-2030 period. This should benefit Lockheed as the company enjoys a dominant position in the military aircraft market with its portfolio containing combat-proven jets like F-16 and F-35 Fighter Aircraft.
Other defense companies that may enjoy the perks of the expanding military aircraft market are as follows:
Boeing (BA - Free Report) : The company is a prominent jet maker and enjoys a dominant position in the combat aircraft market. Its expertise lies in a wide variety of defense aircraft and jet components, repair and modification-related programs. Its military aircraft include C-17 Globemaster III, P-8A Poseidon, V-22 Osprey, etc.
Boeing has a long-term earnings growth rate of 4%. Its investors have gained 37.8% in the past year.
Airbus Group (EADSY - Free Report) : Its military aircraft consist of the A400M, the C295 tactical transporter, the new-generation A330 Multi Role Tanker Transport and the Eurofighter, the most advanced swing-role fighter ever conceived.
Airbus’ long-term earnings growth rate is pegged at 12.4%. Shares of EADSY have returned 29.7% value to its investors in the past year.
Textron (TXT - Free Report) : Its military aircraft includes the Beechcraft T-6 training aircraft and the Beechcraft AT-6 light-attack aircraft. The company also manufactures the Beechcraft Model 18 light bomber, the T-44 and T-34 training aircraft and the T-1A jet trainer.
Textron boasts a long-term earnings growth rate of 11.7%. TXT stock has appreciated 13.1% in the past year.
Price Movement
In the past year, shares of Lockheed Martin have increased 1.5% against the industry’s fall of 8.3%.
Image Source: Zacks Investment Research
Zacks Rank
Lockheed Martin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.