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.
Northrop Grumman Wins $91M Deal to Upgrade Boeing EA-18G Jet
Read MoreHide Full Article
Northrop Grumman Corporation (NOC - Free Report) recently clinched a modification contract for providing upgraded software and hardware support to The Boeing Company’s (BA - Free Report) EA-18G aircraft. Work pertaining to this deal is scheduled to be over by Jul 2019.
Details of the Deal
Valued at $91 million, this contract has been awarded by the Naval Air Warfare Center Weapons Division, China Lake, CA; and work under this will be carried out in Pt. Mugu, CA. Northrop will utilize fiscal 2017 research, development, test and evaluation (Navy) funds to complete the work.
Northrop has been entrusted withthe design, development and implementation of Airborne Electronic Attack (AEA) requirements for software configuration and upgrade of the same as well as ancillary hardware in support of the EA-18G aircraft for the U.S. and the government of Australia. Notably, the U.S. Navy will fund 92% of the total contract while the rest of the expenses will be borne by the Australian government.
A Brief Note on EA-18G & AEA
Boeing’s EA-18G Growler is the most advanced AEA aircraft that operates either from an aircraft or from land bases. The EA-18G integrates advanced AEA capabilities which have been developed and manufactured by Northrop for the purpose of identifying, degrading and destroying hostile radar-guided air defense and communication systems.
Additionally, as the principal subcontractor to Boeing, Northrop designs and produces the EA-18G entire center fuselages and center barrel replacement assemblies apart from integrating all associated subsystems including the electronic attack capabilities as well as conducting after-delivery product support.
Our View
Being one of the largest aerospace and defense contractors in the U.S., Northrop’s product line serves high-priority categories such as defense electronics, unmanned aircraft and missile defense satisfactorily. Northrop is a leading name in AEA technology, having designed, manufactured and delivered the first electronic attack systems more than five decades ago. Over the years, Northrop has refined and expanded AEA capabilities to ensure successful completion of missions.
The company’s recently released fourth-quarter 2016 results depict an encouraging scenario. Impressively, a growing list of domestic and international opportunities can be observed across its businesses as well. This includes the Ground Based Strategic Deterrent program, Triton for Australia, SABR Radar for the U.S. Air Force and several international customers. Further, additional international programs are being pursued by its Mission systems and Technology Services segments in Australia and in the Middle East.
Such a diverse product portfolio helps Northrop win regular contracts from the U.S. and allied countries. Among the major contracts won in 2017, the modification deal worth $140 million for Battle Field Airborne Communication Node (BACN) payload, operations and support is a significant one.
Going forward, we expect Northrop to exhibit similar outperformance in the upcoming quarters as it continues to win valuable contracts from the Pentagon as well as the nation’s foreign allies. Such contracts will form the foundation for profitable growth and operating income and margin rate expansion over the long term. The aforementioned contract is one such deal.
However, year to date, Northrop underperformed the Zacks categorized Aerospace/Defense industry, with the company’s gain of 4.9% being lower than the industry’s addition of 10.1%. This might have been led by intense competition from some of the largest defense primes in the U.S., particularly The Boeing Company (BA - Free Report) , Lockheed Martin Corp. (LMT - Free Report) and Embraer S.A. (ERJ - Free Report) . Also, the current quarter EPS estimates for the company have declined 3.7% over the past 60 days, which reflects investors’ reluctance to consider the stock as a suitable investment option.
Just released: Driverless Cars: Your Roadmap to Mega-Profits Today. In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Northrop Grumman Wins $91M Deal to Upgrade Boeing EA-18G Jet
Northrop Grumman Corporation (NOC - Free Report) recently clinched a modification contract for providing upgraded software and hardware support to The Boeing Company’s (BA - Free Report) EA-18G aircraft. Work pertaining to this deal is scheduled to be over by Jul 2019.
Details of the Deal
Valued at $91 million, this contract has been awarded by the Naval Air Warfare Center Weapons Division, China Lake, CA; and work under this will be carried out in Pt. Mugu, CA. Northrop will utilize fiscal 2017 research, development, test and evaluation (Navy) funds to complete the work.
Northrop has been entrusted withthe design, development and implementation of Airborne Electronic Attack (AEA) requirements for software configuration and upgrade of the same as well as ancillary hardware in support of the EA-18G aircraft for the U.S. and the government of Australia. Notably, the U.S. Navy will fund 92% of the total contract while the rest of the expenses will be borne by the Australian government.
A Brief Note on EA-18G & AEA
Boeing’s EA-18G Growler is the most advanced AEA aircraft that operates either from an aircraft or from land bases. The EA-18G integrates advanced AEA capabilities which have been developed and manufactured by Northrop for the purpose of identifying, degrading and destroying hostile radar-guided air defense and communication systems.
Additionally, as the principal subcontractor to Boeing, Northrop designs and produces the EA-18G entire center fuselages and center barrel replacement assemblies apart from integrating all associated subsystems including the electronic attack capabilities as well as conducting after-delivery product support.
Our View
Being one of the largest aerospace and defense contractors in the U.S., Northrop’s product line serves high-priority categories such as defense electronics, unmanned aircraft and missile defense satisfactorily. Northrop is a leading name in AEA technology, having designed, manufactured and delivered the first electronic attack systems more than five decades ago. Over the years, Northrop has refined and expanded AEA capabilities to ensure successful completion of missions.
The company’s recently released fourth-quarter 2016 results depict an encouraging scenario. Impressively, a growing list of domestic and international opportunities can be observed across its businesses as well. This includes the Ground Based Strategic Deterrent program, Triton for Australia, SABR Radar for the U.S. Air Force and several international customers. Further, additional international programs are being pursued by its Mission systems and Technology Services segments in Australia and in the Middle East.
Such a diverse product portfolio helps Northrop win regular contracts from the U.S. and allied countries. Among the major contracts won in 2017, the modification deal worth $140 million for Battle Field Airborne Communication Node (BACN) payload, operations and support is a significant one.
Going forward, we expect Northrop to exhibit similar outperformance in the upcoming quarters as it continues to win valuable contracts from the Pentagon as well as the nation’s foreign allies. Such contracts will form the foundation for profitable growth and operating income and margin rate expansion over the long term. The aforementioned contract is one such deal.
However, year to date, Northrop underperformed the Zacks categorized Aerospace/Defense industry, with the company’s gain of 4.9% being lower than the industry’s addition of 10.1%. This might have been led by intense competition from some of the largest defense primes in the U.S., particularly The Boeing Company (BA - Free Report) , Lockheed Martin Corp. (LMT - Free Report) and Embraer S.A. (ERJ - Free Report) . Also, the current quarter EPS estimates for the company have declined 3.7% over the past 60 days, which reflects investors’ reluctance to consider the stock as a suitable investment option.
Zacks Rank
Northrop currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
8 Stocks with Huge Profit Potential
Just released: Driverless Cars: Your Roadmap to Mega-Profits Today. In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>