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Raytheon (RTN) Wins $23M Deal for B-2 Antenna Modification

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Raytheon Company announced that it has secured a $23.4-million contract from the U.S. Air Force. According to the terms of the contract, the company will provide modification service for the B-2 antenna for the B-2 Spirit, also known as the Stealth Bomber. Work related to the deal will be carried out at the company's El Segundo, CA. Operations are expected to be concluded by Sep 22, 2020.

About B-2 Spirit

Northrop Grumman (NOC - Free Report) is the main contractor of B-2 Spirit or the Stealth Bomber. This, by far, is recognized as the only long-range, large-payload aircraft which has the capability to infiltrate deep into protected airspace. It has the capacity to carry more than 20 tons of conventional and nuclear ordnance and can deliver the same under any weather conditions.

As one of the leading manufacturers of radars and other sensors for aircraft, spacecraft and ships, Raytheon is also awarded with regular contract for B-2 antenna. The company’s innovative design and manufacturing expertise has boosted the confidence of the Air Force.

What is Working in Favour of Raytheon?

Raytheon’s Space and Airborne Systems (“SAS”) manufactures radars and other sensors for aircraft, spacecraft and ships.  In particular, the company’s next-generation solutions include the air and missile defense radar (“AMDR”) and the enterprise air surveillance radar, which enables it to support the U.S. Navy and international customers with advanced capabilities to counter emerging threats. During the second quarter, the company secured an order worth $364 million on the AMDR program for the U.S. Navy.

Thanks to its wide range of combat-proven defense products, the company continues to receive scrumptious orders from both Pentagon as well as foreign allies of the nation. The company’s 34.7% of the total booking during the second quarter was from the international orders, which reflects an increase of 2.4% year over year. During the quarter, international sales were up 4.3%, while 42% of its backlog comprised of international programs.

Due to its strong order book from both in and out of the country, the company has reported better-than-expected earnings over a very long time. Raytheon has reported positive earnings surprises in all the last four quarters with a trailing average surprise of 7.87%.

Defense Scenario Boosting Growth

While global terrorism has been a matter of great concern over a long time now, the escalating tension between United States and North Korea is comparatively a new issue. The major countries battling against terrorism are working hard to strengthen their defense and are preparing for internal and external tension.

To this end, the U.S. Senate recently passed fiscal 2018 defense policy bill worth $700 billion, which was proposed in July 2017. This bill provides about $640 billion for Pentagon’s main operations like buying weapons and paying the troops. The rest $60 billion for Overseas Contingency Operations will be utilized to fund the conflicts in Afghanistan, Iraq, Syria and elsewhere. This new plan is expected to present greater opportunities for defense giants like Northrop, Raytheon, Lockheed Martin Corporation (LMT - Free Report) , The Boeing Company (BA - Free Report) etc.

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The Boeing Company (BA) - free report >>

Lockheed Martin Corporation (LMT) - free report >>

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