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Lockheed Martin Wins $62B Deal to Build F-16 Fighter Aircraft

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Lockheed Martin Corp.’s (LMT - Free Report) Aeronautics business division has recently secured a $62-billion contract for the production of new F-16 Foreign Military Sale (FMS) aircraft. The initial delivery order is for 90 F-16 aircraft. The contract was awarded by the Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, OH.

Work related to the deal will be completed in Greenville, SC, and Fort Worth, TX, and is expected to be completed by Dec 31, 2026.

Importance of the F-16 Fighting Falcon Jets

Originally manufactured by General Dynamics (GD - Free Report) , F-16 Falcon jets became part of Lockheed Martin after it acquired the former’s aircraft manufacturing business. As the F-16 Original Equipment Manufacturer (OEM), Lockheed Martin is uniquely qualified to design, engineer, develop, integrate and sustain a complete F-16 weapons system to meet customer requirements.

The F-16 Falcon jets have significantly grown in importance on a global scale over the past few years. A number of 4,588 aircraft have been delivered to customers across 29 nations along with numerous upgrades. Over the past couple of years, the F-16 has witnessed significant development as nations, such as Taiwan, Bulgaria, Morocco and Bahrain, have signed respective agreements to procure new F-16 aircraft. Due to the rising importance, Lockheed Martin has introduced F-16 Block 70/72, which is the newest and the most advanced F-16 aircraft, combining numerous capabilities and structural upgrades

Robust Budget to Boost Prospects

Furthermore, the fiscal 2021 defense budget proposal reflected a solid spending provision of $56.9 billion for military aircraft. With both the House and the Senate having passed the fiscal defense budget bill in recent times, such a stupendous budgetary amendment reflects massive growth prospects for Lockheed Martin’s F-16 program in the days ahead.

This would also benefit other prominent jet makers in the United States, like The Boeing Company (BA - Free Report) and Northrop Grumman (NOC - Free Report) .

Price Performance and Zacks Rank

Lockheed Martin, a Zacks Rank #3 (Hold) stock, has gained 2.8% in the past year against the industry’s decline of 26%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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