Shares of the aerospace and defense operator
) gained 3.2% over the last seven days closing at $89.60 on Dec
24. This can be attributed to a series of contract wins over the
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The total value of the contracts received in the past one week
exceeded $560 million, which included both domestic and foreign
defense contracts. The two latest contract wins, one domestic
while the other international, have a combined value of $204.4
The domestic contract worth $134.4 million is for the design and
development of Global Aircrew Strategic Network Terminals (ASNT)
Increment I. Raytheon will work on the design and the development
phase with work expected to be completed by 2016.
Global ASNT Increment I will be a secure and survivable
multi-path communication system. This system will be used to
disseminate nuclear command and control messages from the highest
levels of government down to lower ranks. In addition, it will
also locate and send information to aircrews at geographically
Secure and prompt delivery of information to the designated
receivers is an essential requirement in nuclear command. We
believe Raytheon with its existing expertise will be able deliver
a system which will make nuclear messages more secure.
The foreign military sales contract is worth $70 million. Per the
contract, Raytheon will supply 11 Advanced Countermeasures
Electronic Systems and multiple replaceable parts to Egypt, Iraq
and the Moroccan government. These electronic gadgets will be
utilized to jam anti-aircraft missiles and anti-aircraft radar
Another foreign contract worth $42.5 million was also received
during this time frame. The contract was from Royal Australian
Navy to manufacture and deliver AN/AQS-22 Airborne Low Frequency
Foreign defense contracts are helping the U.S. defense majors in
a big way as the U.S. defense budget is likely to be trimmed in
the face of increasing government austerities.
Raytheon currently has a Zacks Rank #3 (Hold). Some better-ranked
stocks in the same sector include
The Boeing Company
Lockheed Martin Corporation
). All these stocks hold a Zacks Rank #2 (Buy).