The Ingalls Shipbuilding unit of
Huntington Ingalls Industries
) received a contract from the U.S. Coast Guard to build the
seventh National Security Cutter (NSC).
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The $76.8 million contract will allow Huntington Ingalls to
purchase material and components to support construction of the
new cutter, Kimball (WMSL 756), at its shipyard in Pascagoula.
At a length of 418 feet and a beam of 54 feet, NSC is the biggest
and most technologically advanced class of cutters in the U.S.
Coast Guard shipyard. The cutter is intended to substitute the
Hamilton-class cutters built in the 1960s. It is equipped for
maritime homeland security, law enforcement, marine safety,
environmental protection and national defense missions. It plays
a major role in boosting the Coast Guard's operational
promptness, capacity and effectiveness.
Huntington Ingalls has already procured three NSCs for the Coast
Guard and two additional cutters are under construction at its
Pascagoula unit. The company's fourth NSC − Hamilton (WMSL 753) −
is expected to launch by the end of 2013 and is 39% complete. It
has also recently performed the keel laying ceremony of the fifth
cutter, James (WMSL 754), which is about 16% complete.
Last month, Huntington Ingalls received a $487.1 million
fixed-price incentive firm target contract to provide the U.S.
Coast Guard with a sixth cutter. The company plans to begin the
construction on its sixth cutter, Munro (WMSL 755), later this
Lockheed Martin Corporation
) has collaborated with Huntington Ingalls to provide the latter
command, control, communications, computers, intelligence,
surveillance and reconnaissance (C4ISR) capabilities. Huntington
Ingalls remains enthusiastic about its alliance with the defense
The largest military shipbuilder in the U.S., Huntington Ingalls
is the prime industrial employer in Virginia. Huntington Ingalls,
originally an affiliate of
Northrop Grumman Corporation
), was spun off in Mar 2011. It operates major shipyards in
Louisiana, Mississippi and Virginia.
Recently, Ingalls Shipbuilding received a fixed-price incentive
10-year contract worth $3.33 billion from the U.S. Navy for the
construction of five Arleigh Burke-class destroyers (DDG 51s).
The contract also carries an option for engineering change
proposals, design budgeting requirements and post-delivery
availabilities of these ships. If the option is implemented, the
value of the contract would go up to $3.39 billion.
Huntington Ingalls presently retains a short-term Zacks Rank #3
(Hold). We presently prefer
Erickson Air-Crane Inc
) with a Zacks Rank #1 (Strong Buy).