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RTX Secures a $418M Deal to Support Stinger Missile
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RTX Corporation (RTX - Free Report) recently secured a contract to provide Stinger missile upgrades and replacement. The award has been offered by the U.S. Army Contracting Command, Redstone Arsenal, AL.
Valued at $418.3 million, the contract is expected to be completed by Mar 12, 2028. Work related to this deal will be carried out in Tucson, AZ.
Significance of Stinger Missiles
RTX’s combat-proven Stinger missile is a lightweight, self-contained air defense system that can be rapidly deployed by ground troops. Its supersonic speed, agility and highly accurate guidance and control system give the weapon an operational edge against cruise missiles and all classes of aircraft.
The missile has been enjoying strong demand on account of the ongoing war between Ukraine and Russia. Notably, as per a report from Reuters, the RTX won an award worth $687 million from the U.S. Army to deliver up to 1,468 Stinger missiles to Ukraine.
Due to its remarkable features that can effectively assist in military operations, the Stinger missile has a strong global footprint. Moreover, the recent performance of the missile in repelling Russian attacks significantly bolstered its demand from the European countries. This, in turn, has resulted in RTX witnessing a steady inflow of orders involving the Stinger missile, the latest contract being a bright example of that. Such order growth is expected to boost RTX’s revenues in the coming days.
Prospects for RTX
The recent turbulence between Russia and Ukraine has led nations to strengthen their warfare capabilities to deter any warfare-like situation and repel any sudden assault. In this context, the demand for missiles may increase manifold as these have the immense destructive power to support military operations efficiently.
Looking ahead, per a report from the Markets and Markets firm, the global rockets and missile market is anticipated to witness a CAGR of 6.1% during the 2023-2028 period. This stands to benefit RTX, which enjoys an extensive missile portfolio containing AIM-9X Sidewinder, SM-6, SM-3 interceptor, TOW missiles along with a few more, thereby boasting strong demand in the missile market.
Benefits for Peers
Considering the expanding size of the market, defense behemoths that stand to benefit from the rewarding missile market are:
Northrop Grumman (NOC - Free Report) designs and produces missile products, including advanced high-speed propulsion systems, fuses, warheads and controls for air, sea and land-based systems. Its missile defense program includes AGM-88E advanced anti-radiation guided missiles, the Ground Based Strategic Deterrent weapon system and rocket propulsion systems.
Northrop Grumman has a long-term earnings growth rate of 4.1%. The Zacks Consensus Estimate for NOC’s 2023 sales indicates an improvement of 5.6% from the 2022 reported figure.
Lockheed Martin’s (LMT - Free Report) Missiles and Fire Control business unit develops, manufactures and supports advanced combat missiles and rockets for military customers, including the U.S. Army, Navy, Air Force, Marine Corps, NASA and dozens of foreign allies. Some of its prominent products include the PAC-3 missile and the Terminal High Altitude Area Defense missile.
Lockheed Martin’s long-term earnings growth rate is 6.5%. The consensus estimate for LMT’s 2023 sales indicates an improvement of 1% from the 2022 reported figure.
General Dynamics’ (GD - Free Report) Ordnance and Tactical Systems is the system integrator of the 2.75-inch Hydra-70 family of rockets. It also produces composite rocket motor cases and launch tubes for tactical and strategic missiles.
General Dynamics boasts a long-term earnings growth rate of 8.9%. The consensus mark for GD’s 2023 sales indicates an improvement of 7.3% from the previous year’s reported figure.
Price Movement
In the past year, shares of RTX have lost 10.8% compared with the industry’s decline of 7.3%.
Image: Bigstock
RTX Secures a $418M Deal to Support Stinger Missile
RTX Corporation (RTX - Free Report) recently secured a contract to provide Stinger missile upgrades and replacement. The award has been offered by the U.S. Army Contracting Command, Redstone Arsenal, AL.
Valued at $418.3 million, the contract is expected to be completed by Mar 12, 2028. Work related to this deal will be carried out in Tucson, AZ.
Significance of Stinger Missiles
RTX’s combat-proven Stinger missile is a lightweight, self-contained air defense system that can be rapidly deployed by ground troops. Its supersonic speed, agility and highly accurate guidance and control system give the weapon an operational edge against cruise missiles and all classes of aircraft.
The missile has been enjoying strong demand on account of the ongoing war between Ukraine and Russia. Notably, as per a report from Reuters, the RTX won an award worth $687 million from the U.S. Army to deliver up to 1,468 Stinger missiles to Ukraine.
Due to its remarkable features that can effectively assist in military operations, the Stinger missile has a strong global footprint. Moreover, the recent performance of the missile in repelling Russian attacks significantly bolstered its demand from the European countries. This, in turn, has resulted in RTX witnessing a steady inflow of orders involving the Stinger missile, the latest contract being a bright example of that. Such order growth is expected to boost RTX’s revenues in the coming days.
Prospects for RTX
The recent turbulence between Russia and Ukraine has led nations to strengthen their warfare capabilities to deter any warfare-like situation and repel any sudden assault. In this context, the demand for missiles may increase manifold as these have the immense destructive power to support military operations efficiently.
Looking ahead, per a report from the Markets and Markets firm, the global rockets and missile market is anticipated to witness a CAGR of 6.1% during the 2023-2028 period. This stands to benefit RTX, which enjoys an extensive missile portfolio containing AIM-9X Sidewinder, SM-6, SM-3 interceptor, TOW missiles along with a few more, thereby boasting strong demand in the missile market.
Benefits for Peers
Considering the expanding size of the market, defense behemoths that stand to benefit from the rewarding missile market are:
Northrop Grumman (NOC - Free Report) designs and produces missile products, including advanced high-speed propulsion systems, fuses, warheads and controls for air, sea and land-based systems. Its missile defense program includes AGM-88E advanced anti-radiation guided missiles, the Ground Based Strategic Deterrent weapon system and rocket propulsion systems.
Northrop Grumman has a long-term earnings growth rate of 4.1%. The Zacks Consensus Estimate for NOC’s 2023 sales indicates an improvement of 5.6% from the 2022 reported figure.
Lockheed Martin’s (LMT - Free Report) Missiles and Fire Control business unit develops, manufactures and supports advanced combat missiles and rockets for military customers, including the U.S. Army, Navy, Air Force, Marine Corps, NASA and dozens of foreign allies. Some of its prominent products include the PAC-3 missile and the Terminal High Altitude Area Defense missile.
Lockheed Martin’s long-term earnings growth rate is 6.5%. The consensus estimate for LMT’s 2023 sales indicates an improvement of 1% from the 2022 reported figure.
General Dynamics’ (GD - Free Report) Ordnance and Tactical Systems is the system integrator of the 2.75-inch Hydra-70 family of rockets. It also produces composite rocket motor cases and launch tubes for tactical and strategic missiles.
General Dynamics boasts a long-term earnings growth rate of 8.9%. The consensus mark for GD’s 2023 sales indicates an improvement of 7.3% from the previous year’s reported figure.
Price Movement
In the past year, shares of RTX have lost 10.8% compared with the industry’s decline of 7.3%.
Image Source: Zacks Investment Research
Zacks Rank
RTX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.