Northrop Grumman Corp.’s (NOC - Free Report) business unit, Northrop Grumman Systems, recently secured a contract to deliver Multi-Function Active Sensor Radar Systems for the MQ-4C Triton unmanned aircraft system. The deal has been awarded by the Defense Logistics Agency Aviation, Philadelphia, PA.
Valued at $375.8 million, the contract is scheduled to be completed by Dec 31, 2025. The entire task will be carried out in California.
Advantages of Triton UAS Air Vehicles
Northrop Grumman’s MQ-4C Triton UAS is equipped to provide real-time intelligence, surveillance and reconnaissance (ISR) over the vast ocean and coastal regions. The system is also equipped with a robust mission sensor suite that provides 360-degree coverage on all sensors, ensuring unprecedented maritime domain awareness for the U.S. Navy.
Triton UAS supports a wide range of missions including maritime ISR patrol, signals intelligence, search and rescue, and communications relay. This is because Triton incorporates a reinforced airframe for increased internal payload along with de-icing and lightning protection systems, which allows the aircraft to descend and ascend through harsh maritime weather to get a close view of ships and other targets at sea.
Northrop Grumman’s Prospects
Cost-effectiveness compared with manned aircraft and zero mortality, which UAS offers, has been bolstering demand for military drones. This, in turn, has been driving demand for Triton as it is one of the next-generation UAS.
During the 2018-2025 period, the global unmanned aerial vehicle (UAV) market is anticipated to see a CAGR of 14.5% to reach a value of $52.3 billion (per Markets and Markets research firm). Notably, rise in the procurement of military UAVs by defense forces worldwide is one of the most significant factors, which might provide a boost to the UAV market.
Till date, North America remains the largest market for UAV, buoyed by increasing use of UAVs for border and maritime surveillance activities, particularly in the United States and Canada.
With Northrop Grumman being a prominent defense major in the United States and an expert UAV manufacturer, the aforementioned projections for the UAV market should boost this defense prime’s growth substantially.
In a year’s time, shares of Northrop Grumman have surged about 17.5% compared with the industry’s 5.3% rise.
Zacks Rank & Other Stocks to Consider
Northrop Grumman has a Zacks Rank #2 (Buy). A few other top-ranked stocks in the same space are L3Harris Technology Inc (LHX - Free Report) , General Dynamics Corp. (GD - Free Report) and Leidos Holdings, Inc. (LDOS - Free Report) . While L3Harris sports a Zacks Rank #1 (Strong Buy), General Dynamics and Leidos Holdings carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
L3Harris’ long-term growth estimate currently stands at 8%. The company surpassed the Zacks Consensus Estimate for earnings in the last four quarters, the average beat being 4.21%.
General Dynamics’ long-term growth estimate currently stands at 8.7%. The company outpaced the Zacks Consensus Estimate for earnings in the trailing four quarters, the average beat being 4.85%.
Leidos Holdings long-term growth estimate currently stands at 7.5%. The company surpassed the Zacks Consensus Estimate for earnings in the last four quarters, the average beat being 6.51%.
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