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Lockheed (LMT) Clinches Contract to Aid F-35 Jet Program
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Lockheed Martin Corp.’s (LMT - Free Report) Aeronautics business segment recently secured a modification contract involving its F-35 fighter aircraft. The contract has been awarded by the Naval Air Systems Command, Patuxent River, MD.
Details of the Deal
The latest modification adds scope for Lockheed to provide non-recurring engineering and associated materials for power thermal management system controller, gun lube diminishing manufacturing sources and material shortages redesign effort to support the F-35 Joint Strike Fighter jet program. Valued at $54.5 million, the contract is expected to be completed by January 2030.
Work related to this deal will be executed in Fort Worth, TX. The contract will serve the U.S. Navy, Air Force, Marine Corps and non-Department of Defense participants.
Importance of F-35 for LMT
Lockheed enjoys a dominant position in the global military aircraft space with its F-35 fleet. The stealth aircraft boasts features that make it an ideal choice for many nations. The company’s constant efforts to modernize and upgrade the aircraft using advanced technologies to meet current warfare needs boost demand significantly.
Notably, the F-35 program has remained the largest revenue generator for LMT’s Aeronautics business unit for many years. It also accounted for 26% of the company’s consolidated net sales in 2023.
Lockheed has delivered 9992 F-35 airplanes since the program's inception, with 373 jets in the backlog as of Dec 31, 2023. This surely reflects the solid demand that Lockheed’s F-35 program enjoys in the military aircraft market.
Looking ahead, LMT expects to deliver 147-153 F-35 jets in 2024. The jet deliveries for 2025 and beyond are estimated to be 156. Successful deliveries and subsequent contract wins like the latest one should bolster its Aeronautics segment’s revenues in the coming years.
Growth Prospects
Amid the widespread geopolitical tensions worldwide, nations are rapidly augmenting their defense purchases to strengthen their warfare capabilities. This has led to an increased demand for fighter jets, which form an integral part of a country’s defense products.
Looking ahead, per Mordor Intelligence projections, the global military aviation market is expected to witness a CAGR of 5.2% during the 2024-2030 period. Such projections indicate immense opportunities for Lockheed to reap the benefits of the market’s expansion, with its portfolio containing renowned combat-proven jets like F-16 and F-22 fighter aircraft, in addition to F-35 jets.
Other prominent defense majors involved in the manufacturing of military aircraft are Northrop Grumman (NOC - Free Report) , Airbus Group (EADSY - Free Report) and Textron (TXT - Free Report) . Therefore, these stocks are also expected to gain from the military aviation market’s growth opportunities.
Since its inception, Northrop Grumman has been a pioneer in the development of military aircraft. The company has built some of the world’s most advanced aircraft, ranging from the innovative B-2 Spirit stealth bomber to the game-changing E-2D Advanced Hawkeye.
NOC’s Aeronautics Systems unit is engaged in the design, development, production, integration, sustainment and modernization of advanced aircraft systems. Meanwhile, the Mission Systems segment offers advanced mission solutions and multifunction systems like the Airborne Early Warning & Control, the LONGBOW Fire Control Radar and the Scalable Agile Beam Radar.
Airbus Group’s military aircraft consists 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.
For more than 40 years, the company has been providing its aircraft customers with an extended portfolio of services, ranging from the training of flight and ground staff to live firing exercises anywhere worldwide.
Textron’s 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.
TXT’s subsidiary, Able Aerospace Services, provides component and maintenance, repair and overhaul services in support of commercial and military fixed and rotor-wing aircraft.
Price Movement
Shares of Lockheed have rallied 2.4% in the past six months compared with the industry’s 2.6% growth.
Image: Bigstock
Lockheed (LMT) Clinches Contract to Aid F-35 Jet Program
Lockheed Martin Corp.’s (LMT - Free Report) Aeronautics business segment recently secured a modification contract involving its F-35 fighter aircraft. The contract has been awarded by the Naval Air Systems Command, Patuxent River, MD.
Details of the Deal
The latest modification adds scope for Lockheed to provide non-recurring engineering and associated materials for power thermal management system controller, gun lube diminishing manufacturing sources and material shortages redesign effort to support the F-35 Joint Strike Fighter jet program. Valued at $54.5 million, the contract is expected to be completed by January 2030.
Work related to this deal will be executed in Fort Worth, TX. The contract will serve the U.S. Navy, Air Force, Marine Corps and non-Department of Defense participants.
Importance of F-35 for LMT
Lockheed enjoys a dominant position in the global military aircraft space with its F-35 fleet. The stealth aircraft boasts features that make it an ideal choice for many nations. The company’s constant efforts to modernize and upgrade the aircraft using advanced technologies to meet current warfare needs boost demand significantly.
Notably, the F-35 program has remained the largest revenue generator for LMT’s Aeronautics business unit for many years. It also accounted for 26% of the company’s consolidated net sales in 2023.
Lockheed has delivered 9992 F-35 airplanes since the program's inception, with 373 jets in the backlog as of Dec 31, 2023. This surely reflects the solid demand that Lockheed’s F-35 program enjoys in the military aircraft market.
Looking ahead, LMT expects to deliver 147-153 F-35 jets in 2024. The jet deliveries for 2025 and beyond are estimated to be 156. Successful deliveries and subsequent contract wins like the latest one should bolster its Aeronautics segment’s revenues in the coming years.
Growth Prospects
Amid the widespread geopolitical tensions worldwide, nations are rapidly augmenting their defense purchases to strengthen their warfare capabilities. This has led to an increased demand for fighter jets, which form an integral part of a country’s defense products.
Looking ahead, per Mordor Intelligence projections, the global military aviation market is expected to witness a CAGR of 5.2% during the 2024-2030 period. Such projections indicate immense opportunities for Lockheed to reap the benefits of the market’s expansion, with its portfolio containing renowned combat-proven jets like F-16 and F-22 fighter aircraft, in addition to F-35 jets.
Other prominent defense majors involved in the manufacturing of military aircraft are Northrop Grumman (NOC - Free Report) , Airbus Group (EADSY - Free Report) and Textron (TXT - Free Report) . Therefore, these stocks are also expected to gain from the military aviation market’s growth opportunities.
Since its inception, Northrop Grumman has been a pioneer in the development of military aircraft. The company has built some of the world’s most advanced aircraft, ranging from the innovative B-2 Spirit stealth bomber to the game-changing E-2D Advanced Hawkeye.
NOC’s Aeronautics Systems unit is engaged in the design, development, production, integration, sustainment and modernization of advanced aircraft systems. Meanwhile, the Mission Systems segment offers advanced mission solutions and multifunction systems like the Airborne Early Warning & Control, the LONGBOW Fire Control Radar and the Scalable Agile Beam Radar.
Airbus Group’s military aircraft consists 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.
For more than 40 years, the company has been providing its aircraft customers with an extended portfolio of services, ranging from the training of flight and ground staff to live firing exercises anywhere worldwide.
Textron’s 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.
TXT’s subsidiary, Able Aerospace Services, provides component and maintenance, repair and overhaul services in support of commercial and military fixed and rotor-wing aircraft.
Price Movement
Shares of Lockheed have rallied 2.4% in the past six months compared with the industry’s 2.6% growth.
Image Source: Zacks Investment Research
Zacks Rank
Lockheed currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.