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Can Electronic Warfare Demand Boost Lockheed Martin's Growth?

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Key Takeaways

  • Lockheed Martin won a $209M Navy contract modification for AN/SLQ-32(V)6 electronic warfare systems.
  • Options could lift the contract's value to about $1.71B, with work running through September 2029.
  • Navy fleet modernization supports recurring procurement and upgrades for shipboard electronic warfare systems.

Lockheed Martin (LMT - Free Report) continues to benefit from the U.S. Navy’s efforts to strengthen electronic warfare capabilities across its surface fleet. The company’s Rotary and Mission Systems business recently received a $209 million contract modification for the production of Surface Electronic Warfare Improvement Program AN/SLQ-32(V)6 systems.

The award includes options that could raise the cumulative value of the contract to approximately $1.71 billion. Work will be performed in Liverpool, NY, and Lansdale, PA, and is expected to be completed by September 2029. The size and duration of the program provide Lockheed Martin with continued visibility into future naval work.

The AN/SLQ-32(V)6 is designed to provide electronic warfare capabilities that help Navy ships detect, identify and respond to electromagnetic threats. Such systems are increasingly important as adversaries develop more advanced radar, communications and electronic attack capabilities.

The award highlights continued Navy investment in shipboard electronic warfare and fleet survivability. Lockheed Martin’s role in producing the AN/SLQ-32(V)6 positions it to benefit from recurring procurement and upgrades as the Navy modernizes its surface fleet.

Demand for electronic warfare systems is expected to remain strong as the Navy improves situational awareness and protects naval platforms from increasingly complex threats. Lockheed Martin’s established expertise in electronic warfare, sensors and mission systems could therefore provide steady opportunities across its naval defense business.

Defense Stocks to Keep on the Radar

Growing investment in electronic warfare and naval survivability could also benefit defense contractors with established capabilities in these areas.

RTX Corporation (RTX - Free Report) : RTX develops advanced electronic warfare, radar and sensor technologies for naval and airborne platforms. Its systems help detect, track and counter electromagnetic threats, supporting the survivability of U.S. and allied forces.

Northrop Grumman (NOC - Free Report) : Northrop Grumman provides electronic warfare and mission systems designed to detect and counter threats across multiple domains. Its expertise in sensors and electromagnetic warfare supports demand for advanced naval defense capabilities.

The Zacks Rundown for LMT

Shares of LMT have lost 0.9% in the past year compared with the industry’s 19.8% decline.

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The company's shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 1.39X compared with its industry’s average of 2.12X.

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The Zacks Consensus Estimate for LMT’s 2026 and 2027 earnings has moved north over the past 60 days.

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LMT stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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