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Lockheed Martin Wins $132M Deal for Supporting AN/BVY-1 ISIS
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Lockheed Martin Corp.’s (LMT - Free Report) Rotary and Mission Systems ("RMS") business unit recently won a $132.3-million modification contract for providing engineering services to the AN/BVY-1 Integrated Submarine Imaging System ("ISIS"). Majority of the work related to the deal will be performed in Manassas, Virginia and Syracuse, NY.
Details of the Deal
The contract was awarded by the Naval Sea Systems Command, Washington, DC and is expected to get completed by September 2022.
Lockheed Martin will utilize fiscal 2015, 2016, 2017 and 2018 shipbuilding and conversion (Navy); fiscal 2016, 2017 and 2018 other procurement (Navy); and fiscal 2017 research, development, test and evaluation funds for completing the task.
A Brief Note on LMT's ISIS Program
The ISIS program is mainly engaged in providing mission critical, all-weather, visual and electronic search, digital image management, indication, warning, and platform architecture interface capabilities. It revolutionizes Navy submarine surveillance capabilities by integrating digital video and still images from devices on a submarine's exterior, and presenting real-time imagery and analysis on crews' existing control room tactical displays.
What Favors Lockheed Martin?
In recent times, heightened geo-political tensions looming across the globe and rapid modernization of China’s submarine fleet have compelled the United States to significantly modernize its naval defense. This was evident from the $7.4-billion investment plan to purchase 2 Virginia Class Submarines included in the fiscal 2019 defense budget, which was approved by the U.S. Senate, earlier this June.
Lockheed Martin's RMS unit, which manufactures submarine imaging systems, also offers a wide variety of technical expertise, critical mission support and associated spares. Such technical services are important for the effective functioning of the components and interconnected systems, placed within the submarines. Also, submarine combat system experts in the company aid in several system upgrades and technology insertion for U.S. Navy's electro-optical surveillance system designed for several classes of submarines. Such proven expertise in the field of imaging systems services has enabled the company to clinch the latest deal. In line with this, Lockheed Martin is expected to be one of Pentagon's primary choices to award contracts related to submarine imaging systems support.
Per Market Research Engine firm, the global submarine market is expected to see a CAGR of 4.86% by 2022 from 2017. Such growth can be attributed to the technology advancements, rising transnational terrorism and replacement of existing fleet of submarines on a global scale. This, in turn, will further lead to the increasing demand for technical and maintenance services along with submarine components and spares, thereby boosting the growth prospects of defense contractors like Lockheed Martin, going ahead.
During second-quarter 2018, revenues at Lockheed Martin’s RMS unit increased 4.5% year over year, driven by higher sales for integrated warfare systems and sensors (IWSS) programs as well as C4ISR programs. Based on the increasing demand for submarines, consistent order flows from Pentagon, like the latest one, are expected to generate similar top-line growth for Lockheed Martin’s RMS unit, in the coming days.
Price Movement
Lockheed Martin’s stock has improved about only 10.2% in the last year compared with the industry’s growth of 22.3%. The underperformance may have been caused by the intense competition that the company faces in the aerospace-defense space for its broad portfolio of products and services, both domestically as well as internationally.
Zacks Rank & Key Picks
Lockheed Martin currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the same sector are Aerojet Rocketdyne Holdings , Engility Holdings and Huntington Ingalls Industries (HII - Free Report) .
Aerojet Rocketdyne came up with an average positive earnings surprise of 9.27% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has risen 30.9% to $1.27 in the last 90 days.
Engility Holdings delivered an average positive earnings surprise of 19% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has moved up 16.1% to $2.02 in the last 90 days.
Huntington Ingalls pulled off an average positive earnings surprise of 9.48% for the trailing four quarters. The Zacks Consensus Estimate for 2018 earnings has moved 6.4% north to $17.24 in the last 90 days.
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Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Lockheed Martin Wins $132M Deal for Supporting AN/BVY-1 ISIS
Lockheed Martin Corp.’s (LMT - Free Report) Rotary and Mission Systems ("RMS") business unit recently won a $132.3-million modification contract for providing engineering services to the AN/BVY-1 Integrated Submarine Imaging System ("ISIS"). Majority of the work related to the deal will be performed in Manassas, Virginia and Syracuse, NY.
Details of the Deal
The contract was awarded by the Naval Sea Systems Command, Washington, DC and is expected to get completed by September 2022.
Lockheed Martin will utilize fiscal 2015, 2016, 2017 and 2018 shipbuilding and conversion (Navy); fiscal 2016, 2017 and 2018 other procurement (Navy); and fiscal 2017 research, development, test and evaluation funds for completing the task.
A Brief Note on LMT's ISIS Program
The ISIS program is mainly engaged in providing mission critical, all-weather, visual and electronic search, digital image management, indication, warning, and platform architecture interface capabilities. It revolutionizes Navy submarine surveillance capabilities by integrating digital video and still images from devices on a submarine's exterior, and presenting real-time imagery and analysis on crews' existing control room tactical displays.
What Favors Lockheed Martin?
In recent times, heightened geo-political tensions looming across the globe and rapid modernization of China’s submarine fleet have compelled the United States to significantly modernize its naval defense. This was evident from the $7.4-billion investment plan to purchase 2 Virginia Class Submarines included in the fiscal 2019 defense budget, which was approved by the U.S. Senate, earlier this June.
Lockheed Martin's RMS unit, which manufactures submarine imaging systems, also offers a wide variety of technical expertise, critical mission support and associated spares. Such technical services are important for the effective functioning of the components and interconnected systems, placed within the submarines. Also, submarine combat system experts in the company aid in several system upgrades and technology insertion for U.S. Navy's electro-optical surveillance system designed for several classes of submarines. Such proven expertise in the field of imaging systems services has enabled the company to clinch the latest deal. In line with this, Lockheed Martin is expected to be one of Pentagon's primary choices to award contracts related to submarine imaging systems support.
Per Market Research Engine firm, the global submarine market is expected to see a CAGR of 4.86% by 2022 from 2017. Such growth can be attributed to the technology advancements, rising transnational terrorism and replacement of existing fleet of submarines on a global scale. This, in turn, will further lead to the increasing demand for technical and maintenance services along with submarine components and spares, thereby boosting the growth prospects of defense contractors like Lockheed Martin, going ahead.
During second-quarter 2018, revenues at Lockheed Martin’s RMS unit increased 4.5% year over year, driven by higher sales for integrated warfare systems and sensors (IWSS) programs as well as C4ISR programs. Based on the increasing demand for submarines, consistent order flows from Pentagon, like the latest one, are expected to generate similar top-line growth for Lockheed Martin’s RMS unit, in the coming days.
Price Movement
Lockheed Martin’s stock has improved about only 10.2% in the last year compared with the industry’s growth of 22.3%. The underperformance may have been caused by the intense competition that the company faces in the aerospace-defense space for its broad portfolio of products and services, both domestically as well as internationally.
Zacks Rank & Key Picks
Lockheed Martin currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the same sector are Aerojet Rocketdyne Holdings , Engility Holdings and Huntington Ingalls Industries (HII - Free Report) .
While Aerojet Rocketdyne sports a Zacks Rank #1 (Strong Buy), Huntington Ingalls and Engility carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Aerojet Rocketdyne came up with an average positive earnings surprise of 9.27% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has risen 30.9% to $1.27 in the last 90 days.
Engility Holdings delivered an average positive earnings surprise of 19% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings has moved up 16.1% to $2.02 in the last 90 days.
Huntington Ingalls pulled off an average positive earnings surprise of 9.48% for the trailing four quarters. The Zacks Consensus Estimate for 2018 earnings has moved 6.4% north to $17.24 in the last 90 days.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>