Lockheed Martin Corp.
) has received a contract from the U.S. Department of Defense
(DoD) to provide 19 additional AN/TPQ (Q-53) radar systems, a
long-range counter fire radar that provides soldiers with
enhanced 360-degree protection from indirect fire. The contract
is worth $206 million. The work on the contract will be performed
at Lockheed Martin facilities in Syracuse, N.Y., Moorestown,
N.J., Akron, Ohio, and Clearwater, Fla.
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Lockheed Martin originally won this contract for Q-53 systems,
formerly known as EQ-36, in 2007. In Jul 2008, the U.S. Army
awarded the company 12 initial production systems and in April
2010 a contract with options for an additional 20 systems. In
2010, these Q-53 Lockheed Martin radar systems were used by the
Iraqi and Afghanistan militaries. The systems can easily be
mounted on a truck and have automated leveling and
The defense behemoth has delivered 32 initial production systems
to the U.S. Army to date. Presently, it is producing 33 more
systems, which were awarded in Mar 2012.
In mid 2013, the company won a firm-fixed-price contract
extension worth $206.8 million from the DoD. Per the contract,
Lockheed Martin will supply additional Q-53 radar systems and
their corresponding spare parts.
Lockheed Martin is the largest U.S. defense contractor with a
platform-centric focus that guarantees a steady inflow of
follow-on orders. We expect Lockheed Martin to register a stable
performance in the long run due to a leveraged presence in the
Army, Air Force, Navy and IT programs.
Although the aerospace and defense industry is faced with budget
uncertainty and sequestration, these defense behemoths have
diversified their businesses to counter the effect and are not
lacking in DoD contracts. Recently, Lockheed Martin received an
undefinitized modification contract worth $34.5 million from the
DoD. Per the contract, the company will provide Autonomic
Logistics Information System equipment, training devices, and
sustainment and logistics work. Again, it received a contract
worth $852.3 million from the DoD to provide the required
equipment for F-35 fighter jets under Low Rate Initial Production
The company presently retains a short-term Zacks Rank #2 (Buy).
Other favorable names in the space include
Alliant Techsystems Inc.
Northrop Grumman Corp.
Huntington Ingalls Industries, Inc.
). While Alliant Techsystems carries a Zacks Rank #1 (Strong
Buy), Northrop and Huntington Ingalls hold a Zacks Rank #2