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Leidos Wins a $51M Deal to Upgrade Missile Capabilities
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Leidos Holdings, Inc. (LDOS - Free Report) recently clinched a contract for Missile Warning/Missile Track Enhancement (MW/MT) from the Space Systems Command, Strategic Warning and Surveillance Systems Acquisition Delta. The value of the award is $51 million.
Per the terms of the contract, Leidos will deliver mission software and technology-enabled services to improve missile warning capabilities for the Combatant Commanders' Integrated Command and Control Systems.
What’s Favoring LDOS?
Rapidly increasing geopolitical tensions worldwide, along with heightened regional conflicts in different parts of the globe, like the Middle East and the Russian invasion of Ukraine, have prompted nations to bolster their defense capabilities. Since missiles constitute a large share of a nation’s defense arsenals, countries are investing heftily these days in advanced missile systems for deterrence and defense. This has been boosting the demand for technologically advanced missile systems.
The Mordor Intelligence firm predicts the global market for missiles and missile defense systems to witness a CAGR of 5% between 2024 and 2029. Such growth opportunities offered by the aforementioned market should bode well for Leidos, which also focuses on integrating cutting-edge technologies to enhance missile performance, reliability and effectiveness.
Leidos is a renowned provider of cutting-edge technology, offering the United States access to several medium Earth orbit and low Earth orbit constellations of infrared sensors that can follow and identify the most sophisticated missile threats, from ballistic to hypersonic and tactical to strategic.
Such capabilities of LDOS must have enabled the company to win steady orders for its products that support missile warning and threat detection, like the latest one.
Peer Prospects
As global threats continue to rise, apart from Leidos, defense contractors that are likely to benefit from the growth opportunities offered by the missile and missile defense system market have been discussed below.
The Boeing Company (BA - Free Report) : For almost 25 years, the company has been providing air and missile defense systems to the United States, its allies and international partners. Its offerings include the Avenger Air Defense System and Ground-Based Midcourse Defense.
Boeing boasts a long-term earnings growth rate of 21.3%. The Zacks Consensus Estimate for BA’s 2025 sales implies growth of 20.3% from the prior-year projected figure.
Northrop Grumman (NOC - Free Report) : The company develops and manufactures warheads, fuses, advanced high-speed propulsion systems and other missile components. It is a leading supplier of solid rocket propulsion for air-launched missiles, interceptors, submarine-launched weapons and hypersonic missile systems.
Northrop has a long-term (three to five years) earnings growth rate of 8.7%. The Zacks Consensus Estimate for NOC’s 2024 sales suggests growth of 5.4% from the prior-year reported figure.
Lockheed Martin (LMT - Free Report) : The company’s Missiles and Fire Control business unit develops, manufactures and supports advanced missiles and rockets. Some of its renowned products are the PAC-3 family of missiles, M270, RRPR and THHAD.
Lockheed has a long-term earnings growth rate of 4.7%. The Zacks Consensus Estimate for LMT’s 2024 sales implies growth of 5.3% from the prior-year reported figure.
Price Movement
In the past six months, shares of Leidos have rallied 23.3% compared with the industry’s growth of 1.6%.
Image: Bigstock
Leidos Wins a $51M Deal to Upgrade Missile Capabilities
Leidos Holdings, Inc. (LDOS - Free Report) recently clinched a contract for Missile Warning/Missile Track Enhancement (MW/MT) from the Space Systems Command, Strategic Warning and Surveillance Systems Acquisition Delta. The value of the award is $51 million.
Per the terms of the contract, Leidos will deliver mission software and technology-enabled services to improve missile warning capabilities for the Combatant Commanders' Integrated Command and Control Systems.
What’s Favoring LDOS?
Rapidly increasing geopolitical tensions worldwide, along with heightened regional conflicts in different parts of the globe, like the Middle East and the Russian invasion of Ukraine, have prompted nations to bolster their defense capabilities. Since missiles constitute a large share of a nation’s defense arsenals, countries are investing heftily these days in advanced missile systems for deterrence and defense. This has been boosting the demand for technologically advanced missile systems.
The Mordor Intelligence firm predicts the global market for missiles and missile defense systems to witness a CAGR of 5% between 2024 and 2029. Such growth opportunities offered by the aforementioned market should bode well for Leidos, which also focuses on integrating cutting-edge technologies to enhance missile performance, reliability and effectiveness.
Leidos is a renowned provider of cutting-edge technology, offering the United States access to several medium Earth orbit and low Earth orbit constellations of infrared sensors that can follow and identify the most sophisticated missile threats, from ballistic to hypersonic and tactical to strategic.
Such capabilities of LDOS must have enabled the company to win steady orders for its products that support missile warning and threat detection, like the latest one.
Peer Prospects
As global threats continue to rise, apart from Leidos, defense contractors that are likely to benefit from the growth opportunities offered by the missile and missile defense system market have been discussed below.
The Boeing Company (BA - Free Report) : For almost 25 years, the company has been providing air and missile defense systems to the United States, its allies and international partners. Its offerings include the Avenger Air Defense System and Ground-Based Midcourse Defense.
Boeing boasts a long-term earnings growth rate of 21.3%. The Zacks Consensus Estimate for BA’s 2025 sales implies growth of 20.3% from the prior-year projected figure.
Northrop Grumman (NOC - Free Report) : The company develops and manufactures warheads, fuses, advanced high-speed propulsion systems and other missile components. It is a leading supplier of solid rocket propulsion for air-launched missiles, interceptors, submarine-launched weapons and hypersonic missile systems.
Northrop has a long-term (three to five years) earnings growth rate of 8.7%. The Zacks Consensus Estimate for NOC’s 2024 sales suggests growth of 5.4% from the prior-year reported figure.
Lockheed Martin (LMT - Free Report) : The company’s Missiles and Fire Control business unit develops, manufactures and supports advanced missiles and rockets. Some of its renowned products are the PAC-3 family of missiles, M270, RRPR and THHAD.
Lockheed has a long-term earnings growth rate of 4.7%. The Zacks Consensus Estimate for LMT’s 2024 sales implies growth of 5.3% from the prior-year reported figure.
Price Movement
In the past six months, shares of Leidos have rallied 23.3% compared with the industry’s growth of 1.6%.
Image Source: Zacks Investment Research
Zacks Rank
Leidos currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.