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Lockheed's Unit Secures a Contract to Support the AEGIS Combat System
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Key Takeaways
Lockheed's unit won a $92.2M contract to support and modify the AEGIS combat system for the U.S. Navy.
The contract includes sustainment, new capability packages and BL10 system integration for AEGIS.
Work will be completed by December 2025 in Moorestown, NJ, under Naval Sea Systems Command oversight.
Lockheed Martin Corporation’s (LMT - Free Report) business unit, Rotary and Mission Systems, recently clinched a modification contract involving the AEGIS weapon system. The award has been provided by the Naval Sea Systems Command, Washington, D.C.
Details of LMT’s Deal
Valued at $92.2 million, the contract is expected to be completed by December 2025. Per the terms of the deal, Lockheed will support in-service AEGIS sustainment, develop and field capability packages, integrate and field the BL10 system and provide product documentation for current configurations of the AEGIS combat system.
The work related to this deal will be executed in Moorestown, NJ.
Significance of LMT’s AEGIS
The Aegis Combat System is an advanced naval defense system that combines sensors, weapons and command controls to detect and respond to threats. It can handle multiple missions, including defending air and missile attacks, through its Integrated Air and Missile Defense capability.
Such notable features must have enabled Lockheed to secure contracts for this system from the Pentagon and other U.S. allies, the latest contract being an example.
Growth Prospects for LMT
Rising military conflicts, terrorism and border disputes worldwide, along with rapid technological advancements, have driven nations to enhance their naval defense capabilities, making naval combat systems a critical part of their defensive strategies. Fleet modernization programs by armed forces worldwide have also significantly increased the demand for new naval vessels equipped with advanced technologies.
This is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of 6.5% for the global naval combat systems market during the 2025-2030 period. Such strong market prospects drive growth opportunities for Lockheed, which offers state-of-the-art naval combat systems in addition to Aegis.
LMT’s Integrated Combat System can connect sensors, networks and weapons across a distributed naval force afloat and ashore. On the other hand, its littoral combat ships, equipped with lethal weapons, can serve surface, anti-submarine and mine countermeasure missions.
Opportunities for Other Defense Stocks
Other defense companies that are likely to benefit from the expanding global naval combat systems market are discussed below:
RTX Corporation (RTX - Free Report) : It provides advanced electronic and combat systems for the DDG 1000 warship. Its offerings include a computing environment, modular enclosures, undersea warfare systems, vertical launching systems, advanced guns and integrated power systems.
RTX’s long-term (three to five years) earnings growth rate is 9.3%. The Zacks Consensus Estimate for RTX’s 2025 sales indicates year-over-year growth of 4.2%.
Huntington Ingalls Industries (HII - Free Report) : Through its Ingalls Shipbuilding segment, the company has been designing and building amphibious ships, guided missile destroyers and national security cutters for more than 85 years.
HII has a long-term earnings growth rate of 11%. The Zacks Consensus Estimate for HII’s 2025 sales indicates year-over-year growth of 3.3%.
Northrop Grumman Corporation (NOC - Free Report) : Northrop delivers products like AQS-24B/C Minehunting, Surface Electronic Warfare Improvement Program Block III, Manta Ray and other navigation systems used in naval combat.
Northrop has a long-term earnings growth rate of 3.3%. The Zacks Consensus Estimate for NOC’s 2025 sales indicates year-over-year growth of 2.8%.
LMT Stock Price Movement
LMT shares have gained 7% in the past three months compared with the industry’s 30.9% growth.
Image: Bigstock
Lockheed's Unit Secures a Contract to Support the AEGIS Combat System
Key Takeaways
Lockheed Martin Corporation’s (LMT - Free Report) business unit, Rotary and Mission Systems, recently clinched a modification contract involving the AEGIS weapon system. The award has been provided by the Naval Sea Systems Command, Washington, D.C.
Details of LMT’s Deal
Valued at $92.2 million, the contract is expected to be completed by December 2025. Per the terms of the deal, Lockheed will support in-service AEGIS sustainment, develop and field capability packages, integrate and field the BL10 system and provide product documentation for current configurations of the AEGIS combat system.
The work related to this deal will be executed in Moorestown, NJ.
Significance of LMT’s AEGIS
The Aegis Combat System is an advanced naval defense system that combines sensors, weapons and command controls to detect and respond to threats. It can handle multiple missions, including defending air and missile attacks, through its Integrated Air and Missile Defense capability.
Such notable features must have enabled Lockheed to secure contracts for this system from the Pentagon and other U.S. allies, the latest contract being an example.
Growth Prospects for LMT
Rising military conflicts, terrorism and border disputes worldwide, along with rapid technological advancements, have driven nations to enhance their naval defense capabilities, making naval combat systems a critical part of their defensive strategies. Fleet modernization programs by armed forces worldwide have also significantly increased the demand for new naval vessels equipped with advanced technologies.
This is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of 6.5% for the global naval combat systems market during the 2025-2030 period. Such strong market prospects drive growth opportunities for Lockheed, which offers state-of-the-art naval combat systems in addition to Aegis.
LMT’s Integrated Combat System can connect sensors, networks and weapons across a distributed naval force afloat and ashore. On the other hand, its littoral combat ships, equipped with lethal weapons, can serve surface, anti-submarine and mine countermeasure missions.
Opportunities for Other Defense Stocks
Other defense companies that are likely to benefit from the expanding global naval combat systems market are discussed below:
RTX Corporation (RTX - Free Report) : It provides advanced electronic and combat systems for the DDG 1000 warship. Its offerings include a computing environment, modular enclosures, undersea warfare systems, vertical launching systems, advanced guns and integrated power systems.
RTX’s long-term (three to five years) earnings growth rate is 9.3%. The Zacks Consensus Estimate for RTX’s 2025 sales indicates year-over-year growth of 4.2%.
Huntington Ingalls Industries (HII - Free Report) : Through its Ingalls Shipbuilding segment, the company has been designing and building amphibious ships, guided missile destroyers and national security cutters for more than 85 years.
HII has a long-term earnings growth rate of 11%. The Zacks Consensus Estimate for HII’s 2025 sales indicates year-over-year growth of 3.3%.
Northrop Grumman Corporation (NOC - Free Report) : Northrop delivers products like AQS-24B/C Minehunting, Surface Electronic Warfare Improvement Program Block III, Manta Ray and other navigation systems used in naval combat.
Northrop has a long-term earnings growth rate of 3.3%. The Zacks Consensus Estimate for NOC’s 2025 sales indicates year-over-year growth of 2.8%.
LMT Stock Price Movement
LMT shares have gained 7% in the past three months compared with the industry’s 30.9% growth.
Image Source: Zacks Investment Research
LMT’s Zacks Rank
LMT currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.