Can HII Benefit From Growing Demand for Submarine Construction?
Huntington Ingalls Industries, Inc. HII is strengthening its position in the U.S. submarine market through its Newport News Shipbuilding (NNS) division, which plays a major role in constructing the Navy’s nuclear-powered submarines. As the U.S. Navy focuses on expanding and modernizing its submarine fleet, HII is well-positioned to benefit from sustained demand for advanced undersea platforms.
In July 2026, HII and General Dynamics Corporation’s GD Electric Boat division received contract modifications totaling approximately $76.6 billion to support the construction of five additional Columbia-class and nine additional Virginia-class submarines, along with investments in shipyard infrastructure. Under the Virginia-class program, NNS will serve as the delivery yard for six submarines, while for the Columbia-class program, it will construct and deliver six major module sections per submarine.
HII’s experience in submarine construction provides an important competitive advantage. Newport News Shipbuilding has extensive experience supporting both the Virginia and Columbia-class programs and is one of the two U.S. shipyards capable of building nuclear-powered submarines. This expertise allows the company to participate in some of the Navy’s largest and most strategically important shipbuilding programs.
The company is also investing in its shipbuilding infrastructure and production capabilities to support higher construction volumes. These efforts should help HII meet growing demand while strengthening its role in the U.S. naval shipbuilding industrial base.
With long-term submarine programs, significant construction responsibilities and rising demand for advanced undersea capabilities, HII is well-positioned to benefit from continued investment in the U.S. Navy’s submarine fleet.
Submarine Stocks to Keep on the Radar
Other aerospace and defense companies strengthening their presence in the submarine market are discussed below:
General Dynamics: Through its Electric Boat division, General Dynamics is a major builder of the U.S. Navy’s Virginia-class attack submarines and Columbia-class ballistic missile submarines. Electric Boat also plays a key role in the design, construction and maintenance of nuclear-powered submarines.
BAE Systems BAESY: The company is a leading participant in the United Kingdom’s submarine programs and is the prime contractor for the Royal Navy’s Astute-class nuclear-powered attack submarines. It also contributes to the next-generation Dreadnought-class ballistic missile submarine program.
The Zacks Rundown for HII
Shares of HII have surged 18.9% in the past year compared with the industry’s 6.5% growth.
Image Source: Zacks Investment Research
The company shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 0.90X compared with its industry’s average of 2.68X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for HII’s 2026 and 2027 earnings has moved north over the past 60 days.
Image Source: Zacks Investment Research
HII stock currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
