Lockheed Martin Corp. (LMT - Free Report) has received production contract for the 16th lot of Joint Air-to-Surface Standoff Missile (“JASSM”) from the U.S. Air Force.
The contract is valued at $390.8 million and was awarded by the Air Force Life Cycle Management Center, Eglin Air Force Base, Florida.
Per the contract, Lockheed Martin will produce 360 JASSM-extended range, three foreign military sales (“FMS”) separation text vehicles, one FMS flight test vehicle-live fire as well as tooling and test equipment.
The work is scheduled to be completed by Oct 31, 2021 and will be executed in Orlando.
A Brief Note on JASSM
The JASSM is a long range, conventional, stealthy, air-launched ground attack cruise missile designed for the Air Force and international partners, with a range of 223-621.4 miles. JASSM was designed to destroy high-value, well-defended, fixed and re-locatable targets. The threshold integration aircraft were the F-16,B-52, and F/A-18 E/F. The airframe design was to be compatible with all intended JASSM launch platforms — the B-52H, F-16C/D, F/A-18E/F, F-15E, F-117, B-1B, B-2, P-3C and S-3B. The company has been manufacturing the JASSM cruise missiles at a plant located in Troy, AL since the late 1990s
Lockheed Continues to Win Contracts
Lockheed Martin is the largest U.S. defense contractor with a platform-centric focus that guarantees a steady inflow of follow-on orders from a leveraged presence in the Army, Air Force, Navy and IT programs.
Recently, the company won a $333-million deal to boost the Trident II Missile Program. Also, it was awarded a $632-millliom FMS deal for Hellfire II Missile. Meanwhile, as of Jun 24, 2018, Lockheed Martin has a backlog of $105 billion, of which it expects to recognize nearly 40% in the next 12 months.
Per a report by Markets and Markets research firm, the rocket and missile market is projected to reach $70 billion during the 2017-2022 periods, at a CAGR of 4.74%. This reflects improved growth opportunities for missile-makers like Lockheed Martin in the coming years.
Additionally, in June 2018, the U.S. Senate gave the final nod for the fiscal 2019 defense budget worth $717 billion. This budgetary revision may have a positive impact on Lockheed Martin’s upcoming results as the company is expected to win more contracts. This will boost the flow of orders for other companies like The Boeing Company (BA - Free Report) , Northrop Grumman Corp (NOC - Free Report) and Huntington Ingalls Industries, Inc (HII - Free Report) .
Zacks Rank & Price Performance
Lockheed Martin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past three months, Lockheed Martin’s shares have gained 13.2% against the industry’s decline of 10.4%.
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