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RTX Secures $192M Air Force Contract to Buy AMRAAM Weapons
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RTX Corporation’s (RTX - Free Report) business unit, Missiles and Defense, recently clinched a contract involving Advanced Medium Range Air-to-Air Missiles (AMRAAM). The award has been offered by the Air Force Life Cycle Management Center, Air Dominance Division, Eglin Air Force Base, FL.
Valued at $192 million, the contract is expected to be completed by Nov 29, 2024. Per the terms of the deal, RTX will purchase fielded AMRAAM weapons from various sources.
Work related to this contract will be carried out in Tucson, AZ.
How Will the Deal Favor RTX?
The increasing geopolitical tensions worldwide have prompted nations to strengthen their defense systems manifold. With rapid technological upgrades, missile defense has steadily become pivotal in a nation’s defense strategy. With the United States being the world’s largest weapon supplier and RTX being a prominent U.S. missile maker, the increased missile defense adoption by nations provides the company with solid growth opportunities.
To this end, it is imperative to mention that RTX’s AMRAAM is a versatile combat-proven air dominance weapon, which is currently being used by 37 countries worldwide. AMRAAM has been integrated into some of the renowned fighter jets like Boeing’s (BA - Free Report) F-15 and F/A-18 as well as Lockheed Martin’s (LMT - Free Report) F-22 Raptor and F-35 Lightning.
With this advanced weaponry in its portfolio, RTX enjoys solid demand in the defense space. The latest contract win is an instance of that. This, in turn, is expected to boost the company’s top line in the coming quarters.
What’s Ahead?
Looking ahead, per a report by the Mordor Intelligence firm, the global missile and missile defense market is projected to witness a CAGR of 4.8% during the 2023-2028 period to reach $19.16 billion by 2028.
Such massive growth projections indicate solid opportunities for RTX, which has a handful of combat proven missiles in its product portfolio, like TOW missile, Guidance Enhanced Missile (GEM-T), the National Advanced Surface-to-Air Missile System (NASAMS), Tomahawk, Standard Missile 2 (SM-2) and a few more, in addition to the AMRAAM.
Peer Prospects
Considering the solid growth opportunities offered by the global missile and missile defense market, other major defense primes like Northrop Grumman (NOC - Free Report) , Lockheed Martin and Boeing that specialize in developing technologically advanced missiles should also benefit.
Northrop Grumman’s missile defense program includes AGM-88E advanced anti-radiation guided missiles, the Ground Based Strategic Deterrent weapon system and rocket propulsion systems. In August 2022, the company had been chosen by the U.S. Missile Defense Agency to lead the Homeland Missile Defense Program.
NOC boasts a long-term earnings growth rate of 4.1%. The Zacks Consensus Estimate for its 2023 sales implies an improvement of 5.6% from the 2022 reported figure.
Lockheed Martin’s missile defense program includes the Patriot Advanced Capability-3 (PAC-3) and Terminal High-Altitude Area Defense air and missile defense programs. It also manufactures the Multiple Launch Rocket System, the Joint Air-to-Surface Standoff Missile and Javelin tactical missile programs alongside other tactical missiles.
The stock has a long-term earnings growth rate of 6.5%. Shares of LMT rose 5.9% in the past year.
For almost 25 years, Boeing-built and supported air and missile defense systems have protected the nation, warfighters, allies and international partners against threats ranging from intercontinental ballistic missiles to hostile aircraft. BA’s missile and missile portfolio includes Aegis Ballistic Missile Defense, Avenger, Ground-Based Midcourse Defense and PAC-3 Missile Seeker.
The Zacks Consensus Estimate for Boeing’s 2023 sales indicates an improvement of 19.3% from the 2022 reported figure. The stock has a long-term earnings growth rate of 4%.
Price Performance
In the past year, RTX’s shares have lost 2.8% compared with the industry’s 4.3% decline.
Image: Bigstock
RTX Secures $192M Air Force Contract to Buy AMRAAM Weapons
RTX Corporation’s (RTX - Free Report) business unit, Missiles and Defense, recently clinched a contract involving Advanced Medium Range Air-to-Air Missiles (AMRAAM). The award has been offered by the Air Force Life Cycle Management Center, Air Dominance Division, Eglin Air Force Base, FL.
Valued at $192 million, the contract is expected to be completed by Nov 29, 2024. Per the terms of the deal, RTX will purchase fielded AMRAAM weapons from various sources.
Work related to this contract will be carried out in Tucson, AZ.
How Will the Deal Favor RTX?
The increasing geopolitical tensions worldwide have prompted nations to strengthen their defense systems manifold. With rapid technological upgrades, missile defense has steadily become pivotal in a nation’s defense strategy. With the United States being the world’s largest weapon supplier and RTX being a prominent U.S. missile maker, the increased missile defense adoption by nations provides the company with solid growth opportunities.
To this end, it is imperative to mention that RTX’s AMRAAM is a versatile combat-proven air dominance weapon, which is currently being used by 37 countries worldwide. AMRAAM has been integrated into some of the renowned fighter jets like Boeing’s (BA - Free Report) F-15 and F/A-18 as well as Lockheed Martin’s (LMT - Free Report) F-22 Raptor and F-35 Lightning.
With this advanced weaponry in its portfolio, RTX enjoys solid demand in the defense space. The latest contract win is an instance of that. This, in turn, is expected to boost the company’s top line in the coming quarters.
What’s Ahead?
Looking ahead, per a report by the Mordor Intelligence firm, the global missile and missile defense market is projected to witness a CAGR of 4.8% during the 2023-2028 period to reach $19.16 billion by 2028.
Such massive growth projections indicate solid opportunities for RTX, which has a handful of combat proven missiles in its product portfolio, like TOW missile, Guidance Enhanced Missile (GEM-T), the National Advanced Surface-to-Air Missile System (NASAMS), Tomahawk, Standard Missile 2 (SM-2) and a few more, in addition to the AMRAAM.
Peer Prospects
Considering the solid growth opportunities offered by the global missile and missile defense market, other major defense primes like Northrop Grumman (NOC - Free Report) , Lockheed Martin and Boeing that specialize in developing technologically advanced missiles should also benefit.
Northrop Grumman’s missile defense program includes AGM-88E advanced anti-radiation guided missiles, the Ground Based Strategic Deterrent weapon system and rocket propulsion systems. In August 2022, the company had been chosen by the U.S. Missile Defense Agency to lead the Homeland Missile Defense Program.
NOC boasts a long-term earnings growth rate of 4.1%. The Zacks Consensus Estimate for its 2023 sales implies an improvement of 5.6% from the 2022 reported figure.
Lockheed Martin’s missile defense program includes the Patriot Advanced Capability-3 (PAC-3) and Terminal High-Altitude Area Defense air and missile defense programs. It also manufactures the Multiple Launch Rocket System, the Joint Air-to-Surface Standoff Missile and Javelin tactical missile programs alongside other tactical missiles.
The stock has a long-term earnings growth rate of 6.5%. Shares of LMT rose 5.9% in the past year.
For almost 25 years, Boeing-built and supported air and missile defense systems have protected the nation, warfighters, allies and international partners against threats ranging from intercontinental ballistic missiles to hostile aircraft. BA’s missile and missile portfolio includes Aegis Ballistic Missile Defense, Avenger, Ground-Based Midcourse Defense and PAC-3 Missile Seeker.
The Zacks Consensus Estimate for Boeing’s 2023 sales indicates an improvement of 19.3% from the 2022 reported figure. The stock has a long-term earnings growth rate of 4%.
Price Performance
In the past year, RTX’s shares have lost 2.8% compared with the industry’s 4.3% decline.
Image Source: Zacks Investment Research
Zacks Rank
RTX carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.