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Northrop Clinches Deal to Support E-2D Advanced Hawkeye Jets

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Key Takeaways

  • NOC won a $46.7M contract to support life cycle upgrades for E-2D Advanced Hawkeye aircraft.
  • The deal runs through May 2029 and spans multiple U.S. locations for execution.
  • E-2D jets enhance Navy combat management and battlespace awareness.

Northrop Grumman Corp.’s (NOC - Free Report) business unit, Northrop Grumman Systems, recently clinched a modification contract involving its E-2D Advanced Hawkeye jets. The award has been provided by the Naval Air Systems Command, Patuxent River, MD.

Details of NOC’s Deal

Per the terms of the deal, Northrop will provide support for integrating production attrition capabilities, including updates to software and hardware throughout their life cycle. It covers a wide range of tasks, such as design, programming, integration, manufacturing, quality checks and testing, for the E-2D Advanced Hawkeye aircraft, with varying levels of effort over time.

Valued at nearly $46.7 million, the contract is anticipated to be completed by May 2029. The work related to this contract will be executed in multiple locations across the United States.

What Lies Next for NOC Stock?

Rising military conflicts, terrorism and border disputes, along with rapid technological advancements in combat jets, have led nations to increase their defense spending on combat-proven jets, which constitute an integral part of their defense structure.

This is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of 4.7% for the global military aviation market during the 2025-2030 period.

Such growth prospects should benefit Northrop, which has been a pioneer in the development of manned aircraft. The company's product line includes a wide range of defense aircraft like E-2C Hawkeye 2000, E-130J TACAMO, F-5 Tiger and B-2 Spirit Stealth.  

In particular, Northrop's E-2D Advanced Hawkeye aircraft provides combat management, air and missile defense, and multiple sensor fusion capabilities in an airborne system. These offer the warfighter greater battlespace awareness, particularly in the domain of information operations. 

These features of the E-2D Advanced Hawkeye jets must have been boosting its demand, ushering in solid order flows, like the latest contract win, and in the future, should continue to steadily contribute to NOC’s revenue growth.

Opportunities for Other Aerospace Stocks

Other aerospace companies that are likely to benefit from the expanding global military aviation market are discussed below:

The Boeing Company (BA - Free Report) : The company offers a comprehensive portfolio of the most advanced aircraft in the combat market, which includes F/A-18 Super Hornet, F-15EX, CH-47 Chinook, Chinook Block II and EA-18G Growler.

Boeing boasts a long-term (three to five years) earnings growth rate of 18.1%. The Zacks Consensus Estimate for BA’s 2025 sales suggests an improvement of 25.6%.

Lockheed Martin Corp. (LMT - Free Report) : The company is among the leaders in the combat aircraft space, with its product portfolio constituting some of the most advanced military aircraft, such as the F-35 Lightning II, F-21, F-22 Raptor and F-16 Fighting Falcon.

Lockheed boasts a long-term earnings growth rate of 10.5%. The Zacks Consensus Estimate for LMT’s 2025 sales implies an improvement of 4.7%.

Embraer S.A. (ERJ - Free Report) : The company offers a comprehensive portfolio of the most advanced aircraft in the combat market, which includes the A-29 Super Tucano, P600 AEW&C and the C-390 Millennium military multi-mission aircraft.

The Zacks Consensus Estimate for ERJ’s 2025 sales indicates growth of 15.4%. The company delivered an average earnings surprise of 150.60% in the last four quarters.

NOC Stock Price Movement

In the past month, Northrop shares have risen 4% compared with the industry’s growth of 2.8%.

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NOC’s Zacks Rank

Northrop currently carries a Zacks Rank #4 (Sell). 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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