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Huntington Ingalls Secures Contract to Support Aircraft Carrier
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Key Takeaways
HII won a contract to provide engineering and support services for Nimitz and Ford-class carriers.
The nearly $91.9M deal runs to November 2030 and could reach about $472M if all options are exercised.
Growing naval spending and HII's shipbuilding portfolio support steady orders like this award.
Huntington Ingalls Industries Inc. (HII - Free Report) recently won a contract to provide engineering support for the U.S. Navy’s Nimitz-class and Gerald R. Ford-class aircraft carriers. The work covers engineering, technical and design services, integrated logistics support, configuration and database management, modernization tasks and ship change document development. The contract was awarded by the Naval Sea Systems Command in Washington, D.C.
Valued at nearly $91.9 million, the contract is expected to be completed in November 2030. The contract also includes options that, if exercised, could raise its total value to approximately $472 million.
Growth Prospects for HII
According to a report from the Mordor Intelligence firm, nations across the globe are fortifying their defense spending on military weapons and arsenals as they look to strengthen their defense capabilities. This also includes augmented spending on navy ships for enhanced sea warfare capabilities. Mordor Intelligence also forecasts that the naval vessels market will witness a compound annual growth rate of 6.46% during the 2025-2030 period.
Such increased spending tends to benefit Huntington Ingalls as its Huntington Ingalls’ Ingalls Shipbuilding segment constructs amphibious assault ships, expeditionary warfare ships, surface combatants and national security cutters for the U.S. Navy and boasts a strong portfolio of products. The company’s Newport News segment is involved in the design and construction of nuclear-powered aircraft carriers and submarines.
With more than 135 years of experience in building naval ships, Huntington Ingalls enjoys a consistent flow of orders, like the latest one, which boosts its revenue generation prospects.
Opportunities for Other Defense Stocks
Some other defense players that can gain from the expanding naval vessel market are discussed below.
Lockheed Martin (LMT - Free Report) : Lockheed’s Rotary and Mission Systems (RMS) unit supports integrated warfare systems and sensors programs such as the AEGIS Combat System, the Littoral Combat Ship (LCS) and Multi-Mission Surface Combatant for the U.S. Navy and other allies.
LMT’s long-term (three-to five-year) earnings growth rate is 12.4%. The Zacks Consensus Estimate for 2025 sales implies growth of 4.7% from the prior-year figure.
BAE Systems plc (BAESY - Free Report) : The company commissions, designs, builds, repairs and services a wide range of complex navy ships, including aircraft carriers. Its Queen Elizabeth Class Aircraft Carriers are the largest warships ever constructed in the United Kingdom.
BAESY has a long-term earnings growth rate of 14.4%. The Zacks Consensus Estimate for the company’s 2025 sales suggests a year-over-year increase of 62.9%.
General Dynamics (GD - Free Report) : General Dynamics’ Marine Systems segment is the leading designer and builder of nuclear-powered submarines and a leader in surface combatant and auxiliary ship design and construction for the U.S. Navy.
GD’s long-term earnings growth rate is 12.8%. The Zacks Consensus Estimate for 2025 sales implies growth of 8.9% from the prior-year figure.
Price Performance
In the past year, shares of HII have gained 63.7% compared with the industry’s 20.2% growth.
Image: Bigstock
Huntington Ingalls Secures Contract to Support Aircraft Carrier
Key Takeaways
Huntington Ingalls Industries Inc. (HII - Free Report) recently won a contract to provide engineering support for the U.S. Navy’s Nimitz-class and Gerald R. Ford-class aircraft carriers. The work covers engineering, technical and design services, integrated logistics support, configuration and database management, modernization tasks and ship change document development. The contract was awarded by the Naval Sea Systems Command in Washington, D.C.
Valued at nearly $91.9 million, the contract is expected to be completed in November 2030. The contract also includes options that, if exercised, could raise its total value to approximately $472 million.
Growth Prospects for HII
According to a report from the Mordor Intelligence firm, nations across the globe are fortifying their defense spending on military weapons and arsenals as they look to strengthen their defense capabilities. This also includes augmented spending on navy ships for enhanced sea warfare capabilities. Mordor Intelligence also forecasts that the naval vessels market will witness a compound annual growth rate of 6.46% during the 2025-2030 period.
Such increased spending tends to benefit Huntington Ingalls as its Huntington Ingalls’ Ingalls Shipbuilding segment constructs amphibious assault ships, expeditionary warfare ships, surface combatants and national security cutters for the U.S. Navy and boasts a strong portfolio of products. The company’s Newport News segment is involved in the design and construction of nuclear-powered aircraft carriers and submarines.
With more than 135 years of experience in building naval ships, Huntington Ingalls enjoys a consistent flow of orders, like the latest one, which boosts its revenue generation prospects.
Opportunities for Other Defense Stocks
Some other defense players that can gain from the expanding naval vessel market are discussed below.
Lockheed Martin (LMT - Free Report) : Lockheed’s Rotary and Mission Systems (RMS) unit supports integrated warfare systems and sensors programs such as the AEGIS Combat System, the Littoral Combat Ship (LCS) and Multi-Mission Surface Combatant for the U.S. Navy and other allies.
LMT’s long-term (three-to five-year) earnings growth rate is 12.4%. The Zacks Consensus Estimate for 2025 sales implies growth of 4.7% from the prior-year figure.
BAE Systems plc (BAESY - Free Report) : The company commissions, designs, builds, repairs and services a wide range of complex navy ships, including aircraft carriers. Its Queen Elizabeth Class Aircraft Carriers are the largest warships ever constructed in the United Kingdom.
BAESY has a long-term earnings growth rate of 14.4%. The Zacks Consensus Estimate for the company’s 2025 sales suggests a year-over-year increase of 62.9%.
General Dynamics (GD - Free Report) : General Dynamics’ Marine Systems segment is the leading designer and builder of nuclear-powered submarines and a leader in surface combatant and auxiliary ship design and construction for the U.S. Navy.
GD’s long-term earnings growth rate is 12.8%. The Zacks Consensus Estimate for 2025 sales implies growth of 8.9% from the prior-year figure.
Price Performance
In the past year, shares of HII have gained 63.7% compared with the industry’s 20.2% growth.
Image Source: Zacks Investment Research
Zacks Rank
HII currently has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.