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Raytheon (RTN) Wins $25M Air Force Deal for Griffin Missiles
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Defense behemoth Raytheon Company’s business division Missile Systems recently secured a fixed-price contract for its Griffin A Block/III missiles. Work for this deal is scheduled to be over by Dec 1, 2017.
Details of the Deal
Valued at $25 million, this deal was awarded by the Air Force Life Cycle Management Center, Eglin Air Force Base, FL. The contract will utilize procurement funds of fiscal 2016 and 2017.
Work related to this deal will be carried out at Tuscon, AZ. Notably, the contract comes from a sole-source acquisition. Raytheon’s Griffin missile is a multi-platform, multi-service weapon that facilitates successful rapid integration on land, sea and air.
Brief note on Griffin Missile System
As mentioned earlier, Raytheon’s Griffin Missile System is a combat-proven missile which has been serving the U.S. Air Force and U.S Navy force since its inception in 2008. The missile system can engage both static and fast-moving targets and offers reliable operational effectiveness to fighters against a variety of threats in counter-insurgency and irregular warfare operations.
Currently, this missile system offers two variants: Griffin A, which is an aft-eject missile and Griffin B, which is a forward-firing missile. Raytheon is also developing additional variants, including the Griffin C missile with dual-mode guidance and Griffin C-ER, which will be an extended range missile.
In particular, the Griffin A variant can be deployed by Lockheed Martin Corp.’s (LMT - Free Report) C-130 series of aircraft – a tactical jet that has been witnessing strong demand in domestic as well as overseas defense space over the past few years. No doubt, with geo-political uncertainties increasing across the globe, mutli-service weapons like Raytheon’s Griffin Missile system will witness high demand from the U.S as well as its ally governments.
Price Movement
Raytheon’s stock has gained about 17.92% in the last one year, comfortably outperforming the Zacks Categorized Aerospace/Defense industry’s 15% over the same time frame. Courtesy of its wide range of combat-proven defense products, the company continues to receive orders from both the Pentagon as well as foreign allies of the nation.
Raytheon has been a consistent performer over the years, which has been driving its share price and earnings results. Encouragingly, the company surpassed the Zacks Consensus Estimate in all of the four trailing quarters, with an average positive surprise of 6.27%. The long-term earnings growth of the company is pegged at 7.22%.
Our View
With the recent rise in terrorist activities across the globe, particularly the ever increasing threat of radical institutions with access to weapons of mass destruction, exemplified by the conduct of rogue states like North Korea and some nations in Middle East; demand for missiles and missile defense systems have literally reached at its peak. This has compelled developed nations to indulge in enhancing their individual defense power, by storing up as much tactical weaponries as possible.
Majority of the top 10 weapons manufacturers like Northrop Grumman Corp. (NOC - Free Report) , United Technologies Corporation , General Dynamics Corp (GD - Free Report) and a few others hail from the U.S. Raytheon is poised to gain traction in the aerospace and defense sector with the global missiles and missile defense systems market projected to grow at a CAGR of 4.93% during 2014-2024, to reach a value of $38.5 billion.
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Raytheon (RTN) Wins $25M Air Force Deal for Griffin Missiles
Defense behemoth Raytheon Company’s business division Missile Systems recently secured a fixed-price contract for its Griffin A Block/III missiles. Work for this deal is scheduled to be over by Dec 1, 2017.
Details of the Deal
Valued at $25 million, this deal was awarded by the Air Force Life Cycle Management Center, Eglin Air Force Base, FL. The contract will utilize procurement funds of fiscal 2016 and 2017.
Work related to this deal will be carried out at Tuscon, AZ. Notably, the contract comes from a sole-source acquisition. Raytheon’s Griffin missile is a multi-platform, multi-service weapon that facilitates successful rapid integration on land, sea and air.
Brief note on Griffin Missile System
As mentioned earlier, Raytheon’s Griffin Missile System is a combat-proven missile which has been serving the U.S. Air Force and U.S Navy force since its inception in 2008. The missile system can engage both static and fast-moving targets and offers reliable operational effectiveness to fighters against a variety of threats in counter-insurgency and irregular warfare operations.
Currently, this missile system offers two variants: Griffin A, which is an aft-eject missile and Griffin B, which is a forward-firing missile. Raytheon is also developing additional variants, including the Griffin C missile with dual-mode guidance and Griffin C-ER, which will be an extended range missile.
In particular, the Griffin A variant can be deployed by Lockheed Martin Corp.’s (LMT - Free Report) C-130 series of aircraft – a tactical jet that has been witnessing strong demand in domestic as well as overseas defense space over the past few years. No doubt, with geo-political uncertainties increasing across the globe, mutli-service weapons like Raytheon’s Griffin Missile system will witness high demand from the U.S as well as its ally governments.
Price Movement
Raytheon’s stock has gained about 17.92% in the last one year, comfortably outperforming the Zacks Categorized Aerospace/Defense industry’s 15% over the same time frame. Courtesy of its wide range of combat-proven defense products, the company continues to receive orders from both the Pentagon as well as foreign allies of the nation.
Raytheon has been a consistent performer over the years, which has been driving its share price and earnings results. Encouragingly, the company surpassed the Zacks Consensus Estimate in all of the four trailing quarters, with an average positive surprise of 6.27%. The long-term earnings growth of the company is pegged at 7.22%.
Our View
With the recent rise in terrorist activities across the globe, particularly the ever increasing threat of radical institutions with access to weapons of mass destruction, exemplified by the conduct of rogue states like North Korea and some nations in Middle East; demand for missiles and missile defense systems have literally reached at its peak. This has compelled developed nations to indulge in enhancing their individual defense power, by storing up as much tactical weaponries as possible.
Majority of the top 10 weapons manufacturers like Northrop Grumman Corp. (NOC - Free Report) , United Technologies Corporation , General Dynamics Corp (GD - Free Report) and a few others hail from the U.S. Raytheon is poised to gain traction in the aerospace and defense sector with the global missiles and missile defense systems market projected to grow at a CAGR of 4.93% during 2014-2024, to reach a value of $38.5 billion.
Zacks Rank
Currently, Raytheon carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 ""Strong Buy"" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 ""Strong Sells"" and other private research. See these stocks free >>