Defense majors picked up small ticket programs from the U.S.
Department of Defense's (DoD) funding list on Friday, May 30, 2014.
Amongst the gainers, in terms of number of contracts,
Northrop Grumman Corp.
) won three separate deals, for a total value of $71.9 million. Of
these, the intelligence, surveillance, reconnaissance and targeting
(ISR&T) unit won a $38.0 million contract to provide logistics
support and engineering services to the Joint Tactical Ground
Station (JTAGS) system Block 1 fielded units and related exerciser
and institutional training suites. The task is expected to be
completed by Jul 31, 2018.
The second win for Northrop was a modification contract for $20.9
million. This contract calls for Northrop to provide integration
services for mission packages to the U.S. Navy that will deploy
from and integrate with the Littoral Combat Ship (LCS). This is
necessary to evaluate system maturity that will help to perk up
mission capability in identified mission areas. LCS mission
packages will be optimized for flexibility in the littorals. The
work is expected to be completed by Jan 2015.
The third contract valued at $13.0 million is also a modification
contract related to the Enhanced Integrated Sensor Suite (EISS)
Timing and Control (TAC) Module A-3 replacement effort. Per this
contact, Northrop will have to complete flight testing required for
ensuring the EISS TAC module. The company is also entitled to
ensure other related software developments that are compatible with
the Global Hawk aircraft in form, fit and function. The work under
this contract is slated for completion by Jun 30, 2015.
Apart from Northrop, the pentagon's prime contract
Lockheed Martin Corp.
) has secured a modification contract, worth $41.2 million, for the
Highly Elliptical Orbit (HEO) Transition to Operations. This
contract from the U.S. Air Force calls for Lockheed to add HEO-4
launch and early on-orbit test (LEOT) capabilities to the HEO-3
LEOT baseline. The task is expected to be completed by Sep 30,
General Dynamics Corp.
) also received a $12.7 million contract. As per this modification
contract, General Dynamics will provide added explosive cartridges,
explosive d 5", explosive d dye filled, improved conventional
munitions, medium caliber and fuses. The contract is expected to be
completed by May 27, 2015.
The ongoing sequestration wave has hit the U.S. defense sector with
prominent contractors like Lockheed, Northrop or General Dynamics
having to make do with low-value contracts. Although budget cuts
have diminished the flow of large-priced contracts in the U.S., the
prime sector players are effectively battling sequestration with
their diversified product offerings and strategic partnerships.
Currently, Northrop and General Dynamics hold a Zacks Rank #3
(Hold), while Lockheed carries a Zacks Rank #2 (Buy).
) looks like a great pick as it carries a Zacks Rank #1 (Strong
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