The latest defense contracts offered by the U.S. Department of
Defense (DoD) were valued at a whopping $7.59 billion. Among the
), which clinched a $15.0 million modification contract for
Cooperative Engagement Capabilities (CEC) production to the U.S.
Navy. The contract is set to run through Oct 2014.
Defense players like
General Dynamics Corp.
Lockheed Martin Corp.
) were the other key contract gainers. This is another feather
that Raytheon added to its cap after the $54.0 million
modification contract from the U.S. Army on Aug 26.
The contracting activity of the CEC contract is the Naval Sea
Systems Command, Washington, D.C. The necessary tasks related to
the contract will be executed majorly at Largo, Fla. as well as
in Dallas, Texas and St. Petersburg, Fla.
The CEC system is Raytheon's flagship product, designed to
enhance battle force effectiveness by improving overall
situational awareness and by supporting longer range,
cooperative, multiple, or layered engagement strategies. The
system is able to interpret data from remote sources and provides
a clear picture of the opposition's move.
Recently, Lockheed Martin and the U.S. Navy successfully test
fired its Aegis Combat System equipped with CEC under the Naval
Integrated Fire Control-Counter Air program. The CEC system has
been a game changer in shaping the defense landscape by
increasing the lifespan of cruisers and destroyers.
Raytheon has been known for introducing high-tech engineering
and systems support capabilities to the U.S. defense. The company
recently secured a two-year long maritime border security
contract from Philippines for constructing and developing a
National Coast Watch Center (NCWC), which will allow data
integration from various agencies into the NCWC.
We note that amid the current budget sequestration, Raytheon
has received a string of DoD contracts. We believe the company
will retain its growth momentum on the back of its technological
acumen. This will contribute to consistent international and
domestic order flows.
At the moment, Raytheon's position in the market looks good
with a Zacks Rank #2 (Buy). An industry operator also worth
mentioning is Zacks Ranked #2 (Buy)
Northrop Grumman Corp.
GENL DYNAMICS (GD): Free Stock Analysis
LOCKHEED MARTIN (LMT): Free Stock Analysis
NORTHROP GRUMMN (NOC): Free Stock Analysis
RAYTHEON CO (RTN): Free Stock Analysis Report
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