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Can Rising F-35 Radar Demand Support Northrop Grumman's Growth?
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Key Takeaways
Northrop Grumman won a $123.8M award supporting production of 67 APG-85 radars for U.S. military services.
NOC's APG-85 radar boosts F-35 threat detection and tracking, supporting demand for advanced sensors.
NOC's long-term APG-85 production could support recurring revenues from F-35 output and upgrades.
Northrop Grumman (NOC - Free Report) is strengthening its position in the F-35 program through continued demand for its advanced APG-85 radar. The company recently received a not-to-exceed $123.8 million contract from the U.S. Navy for long-lead materials, parts, components and related efforts, supporting the production of 67 APG-85 radars for the Air Force, Marine Corps and Navy.
The work will be performed in Linthicum Heights, MD, and is expected to be completed by February 2031. The award provides Northrop Grumman with long-term production visibility while supporting the delivery schedule of F-35 aircraft across the U.S. military services.
The APG-85 is designed to provide advanced sensing and targeting capabilities for the F-35, supporting the aircraft’s ability to detect and track threats. Continued procurement of the radar highlights the importance of advanced sensor systems as the U.S. military expands and sustains its F-35 fleet.
The contract also reflects Northrop Grumman’s established role in supplying critical mission systems for the F-35. Long-term production programs such as the APG-85 can support recurring revenue opportunities as additional aircraft are produced and existing platforms receive upgrades and sustainment.
With the F-35 remaining an important part of U.S. tactical airpower plans, continued demand for its radar and other mission-critical systems could provide a steady growth opportunity for Northrop Grumman.
Defense Stocks to Keep on the Radar
The continued expansion of advanced fighter aircraft programs could also support companies supplying critical systems and technologies.
Lockheed Martin (LMT - Free Report) : Lockheed Martin is the F-35’s prime contractor and continues to produce the aircraft for the U.S. and international customers, supporting long-term demand across its fighter aircraft business.
RTX Corporation (RTX - Free Report) : RTX supplies the F-35 through its Pratt & Whitney engine business and Collins Aerospace systems. Continued F-35 production and sustainment provide recurring opportunities across propulsion, avionics and other aircraft systems.
The Zacks Rundown for NOC
Shares of NOC have surged 1.8% in the past three months against the industry’s 10.3% decline.
Image Source: Zacks Investment Research
The company's shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 1.57X compared with its industry’s average of 2.24X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NOC’s 2026 and 2027 earnings has remained the same over the past 60 days.
Image Source: Zacks Investment Research
NOC stock currently carries a Zacks Rank #3 (Hold).
View the Zacks #1 Rank List
Image: Bigstock
Can Rising F-35 Radar Demand Support Northrop Grumman's Growth?
Key Takeaways
Northrop Grumman (NOC - Free Report) is strengthening its position in the F-35 program through continued demand for its advanced APG-85 radar. The company recently received a not-to-exceed $123.8 million contract from the U.S. Navy for long-lead materials, parts, components and related efforts, supporting the production of 67 APG-85 radars for the Air Force, Marine Corps and Navy.
The work will be performed in Linthicum Heights, MD, and is expected to be completed by February 2031. The award provides Northrop Grumman with long-term production visibility while supporting the delivery schedule of F-35 aircraft across the U.S. military services.
The APG-85 is designed to provide advanced sensing and targeting capabilities for the F-35, supporting the aircraft’s ability to detect and track threats. Continued procurement of the radar highlights the importance of advanced sensor systems as the U.S. military expands and sustains its F-35 fleet.
The contract also reflects Northrop Grumman’s established role in supplying critical mission systems for the F-35. Long-term production programs such as the APG-85 can support recurring revenue opportunities as additional aircraft are produced and existing platforms receive upgrades and sustainment.
With the F-35 remaining an important part of U.S. tactical airpower plans, continued demand for its radar and other mission-critical systems could provide a steady growth opportunity for Northrop Grumman.
Defense Stocks to Keep on the Radar
The continued expansion of advanced fighter aircraft programs could also support companies supplying critical systems and technologies.
Lockheed Martin (LMT - Free Report) : Lockheed Martin is the F-35’s prime contractor and continues to produce the aircraft for the U.S. and international customers, supporting long-term demand across its fighter aircraft business.
RTX Corporation (RTX - Free Report) : RTX supplies the F-35 through its Pratt & Whitney engine business and Collins Aerospace systems. Continued F-35 production and sustainment provide recurring opportunities across propulsion, avionics and other aircraft systems.
The Zacks Rundown for NOC
Shares of NOC have surged 1.8% in the past three months against the industry’s 10.3% decline.
Image Source: Zacks Investment Research
The company's shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 1.57X compared with its industry’s average of 2.24X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NOC’s 2026 and 2027 earnings has remained the same over the past 60 days.
Image Source: Zacks Investment Research
NOC stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.