) was awarded a $116 million firm-fixed-price level-of-effort
contract from the Army Contracting Command in Redstone Arsenal,
Alabama. This is a modification of an existing contract to
provide engineering services for the PATRIOT in support of
Foreign Military Sales. Work on the contract will be
performed in Andover, Billerica, Tewksbury, and Burlington in
Massachusetts; El Segundo in California; El Paso in Texas;
Huntsville in Alabama; Norfolk in Virginia; and Pelham and White
Sands Missile Range in New Hampshire. Raytheon expects to finish
work on the contract by Jan 31, 2014.
Patriot is the affordable, low-risk and effective air and
missile defense system of choice of 12 countries around the
globe. It is a long-range, all-altitude, all-weather air defense
system that counters tactical ballistic missiles, cruise missiles
and advanced aircraft. It is co-manufactured by Raytheon and
Lockheed Martin Missiles and Fire Control, a business unit of
Lockheed Martin Corporation
Based in Waltham, Massachusetts, Raytheon Company is a
technology and innovation leader specializing in defense,
homeland security and other government markets throughout the
world. The company provides state-of-the-art electronics, mission
systems integration and other capabilities in the areas of
sensing, effects, and command, control, communications and
intelligence systems, as well as a broad range of mission support
Raytheon is one of the best-positioned companies among the
large-cap defense players because of its non-platform-centric
focus. Looking forward, the company enjoys strong order bookings
and order backlog, an improving balance sheet, growing cash flow,
and operational improvements. Future growth will be driven by its
focus on ISR unmanned systems, training, cyber security, Standard
Missile-6, Patriot, Zumwalt and THAAD.
Going forward, revenue and earnings growth would continue to
be driven by its strong and diversified presence in the areas of
Intelligence, Surveillance and Reconnaissance (ISR); air traffic
management; training and homeland security; and cyber
These positives are however offset by the uncertainty related
to defense budgets, the fate of high-cost programs, risks related
to key project executions and order cancellations. The company
presently retains a short-term Zacks Rank #3 (Hold).
Other stocks to consider are
Huntington Ingalls Industries, Inc.
) that retains a short-term Zacks Rank #1 (Strong Buy) and
FLIR Systems, Inc.
) that presently carries a short-term Zacks Rank #2 (Buy).
FLIR SYSTEMS (FLIR): Free Stock Analysis
HUNTINGTON INGL (HII): Free Stock Analysis
LOCKHEED MARTIN (LMT): Free Stock Analysis
RAYTHEON CO (RTN): Free Stock Analysis Report
To read this article on Zacks.com click here.