Latest news with #Long-RangeAnti-ShipMissile
Yahoo
04-04-2025
- Business
- Yahoo
Lockheed Martin Secures a Contract to Manufacture LRASM
Lockheed Martin Corporation LMT recently secured a modification contract valued at $13.3 million for the production of Long-Range Anti-Ship Missile's (LRASM) ninth lot. The award has been provided by the Air Force Life Cycle Management Center, Eglin Air Force Base, work related to this deal will be carried out in Orlando, FL, and is projected to be completed by Dec. 31, 2028. The latest modification brings the total value of the contract to $5.19 billion. Lockheed Martin's LRASM is a precision-guided intelligent anti-ship missile designed to prevent a variety of surface threats at very long ranges. It can navigate semi-autonomously to a target and deliver a precise payload from a safe standoff notable features must have enabled Lockheed Martin to secure a number of contracts for these missiles from the Pentagon and other U.S. allies, the latest contract being an example of that. Rising military conflicts, terrorism and border disputes have led nations to increase their focus on national security, particularly on missile defense systems, backed by the rapid development of advanced missile technologies over the last is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of 5% for the global missiles and missile defense systems market during the 2025-2030 time market projections offer solid growth opportunities for Lockheed Martin, with its Missile and Fire Control unit being a recognized developer of high-performance missiles. The unit pursues business in more than 50 countries worldwide. Some of its major programs are the Patriot Advanced Capability-3 (PAC-3) and Terminal High Altitude Area Defense (THAAD) air and missile defense programs, in addition to the LRASM. Other defense companies that are likely to enjoy the perks of the expanding global missiles and missile defense system market have been discussed Grumman Corporation NOC: Northrop Grumman provides high-speed, long-range strike weapons like the AARGM-ER, which is a supersonic, air-launched tactical missile system. It also develops and builds advanced missile defense technology, ranging from command systems to directed energy weapons, advanced munitions and powerful company's long-term (three to five years) earnings growth rate is 4.2%. The Zacks Consensus Estimate for NOC's 2025 sales indicates year-over-year growth of 3%.RTX Corporation RTX: It is known for its missile defense systems like the Patriot and SM-6, which are in high demand globally. RTX also provides advanced sensors and interceptors to identify, track and defeat threats as part of a layered missile company's long-term earnings growth rate is 9.7%. The Zacks Consensus Estimate for RTX's 2025 sales indicates year-over-year growth of 4.4%.The Boeing Company BA: It manufactures various missile defense systems, including the Ground-based Midcourse Defense, Aegis Ballistic Missile Defense and Avenger. Boeing-built and supported air and missile defense systems have been protecting its customers for nearly 25 years against threats ranging from intercontinental ballistic missiles to hostile company has a long-term earnings growth rate of 17.4%. The Zacks Consensus Estimate for BA's 2025 sales indicates year-over-year growth of 25.7%. Shares of LMT have lost 0.2% in the past year against the industry's 13.3% growth. Image Source: Zacks Investment Research LMT currently carries a Zacks Rank #4 (Sell).You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Boeing Company (BA) : Free Stock Analysis Report Lockheed Martin Corporation (LMT) : Free Stock Analysis Report Northrop Grumman Corporation (NOC) : Free Stock Analysis Report RTX Corporation (RTX) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
29-03-2025
- Business
- Yahoo
Why Is the U.S. Air Force Buying $1.9 Billion in New Missiles From Lockheed Martin?
Big contract announcements at the U.S. Pentagon can clue investors in to the potential for lucrative stock wins from the companies that win those contracts. It doesn't always work this way, but it does sometimes. That's why I'm paying attention now to one of the biggest weapons contracts announced by the Department of Defense in recent weeks: A March 13 order from the Air Force instructing Lockheed Martin (NYSE: LMT) to proceed with production of order "Lot 23" of the Joint Air to Surface Standoff Missile (JASSM) and also order "Lot 9" of the Long-Range Anti-Ship Missile (LRASM), and to prepare for subsequent lots as well. Both these missile types have been requested by Ukraine for use in its defensive war against Russia. Additionally, both weapons systems fit within the Pentagon's plans to improve the United States' long-range strike capabilities in the Pacific theater. The Pentagon did not specify precisely how many missiles Lockheed will be building, and amounts appear to vary from lot to lot. However, a 2023 Defense Department document described the sizes of production lots as ranging from 550 to 810 missiles per JASSM lot, and from 120 to 240 missiles per LRASM lot. We also know much more precisely what the Pentagon plans to pay for these missiles: $1.9 billion. The Pentagon's contract announcement also clarifies that the production lots in question are part of a bigger rearmament project that has the Air Force ordering $5.2 billion worth of the missiles in total. And with three more production lots each anticipated for both the JASSM and the LRASM, it's likely the size of this contract -- and its value to Lockheed Martin -- will continue to grow. But precisely how much can contracts like these move the needle at a giant defense company like Lockheed, which did $71 billion in defense business last year, and recorded more than $5.3 billion in profits from it? That's actually harder to determine than you might think. Most years, Lockheed Martin's missiles and fire control division (MFC) is a pretty great business. From 2019 through 2023, according to data from S&P Global Market Intelligence, MFC rang up $7.8 billion in operating profit on $58.7 billion in revenue, earning an outstanding 13.3% operating profit margin on this part of its business. In the final quarter of 2024, however, something went seriously awry at MFC. Without warning, the company took an $804 million charge to earnings for this division -- and only this division. All on its own, this charge drove a 23% year-over-year decline in Lockheed's annual profit for 2024, despite revenues rising 5% last year, and MFC revenues in particular rising 13%. Lockheed blamed the decline on "$1.4 billion in losses on a classified program," about which it would say no more. Presumably, JASSM and LRASM are not part of this classified program ... because, well, we know what these missiles are called. They're not classified. And if these particular missiles are unconnected to what required Lockheed to take that charge last quarter, it makes sense to assume that higher production rates of them would still be good news for Lockheed, and that MFC will continue to produce its enviably high 13.3% operating profit margins for Lockheed Martin shareholders. At $1.9 billion in revenue, the two lots of missiles in question should contribute more than $250 million to Lockheed Martin's annual profit. I wouldn't necessarily call this an incremental increase in profits, however. As just two lots in a long string of missile lots previously delivered, these latest orders will more likely simply replace past orders, and keep the revenue stream flowing. That's still good news, of course. It's just probably not needle-moving news. For this reason, it leaves the way I value Lockheed Martin stock unchanged. Lockheed stock trades at 1.5 times trailing sales, which is slightly more than its average valuation over the past 20 years by that metric, (and therefore not a bargain). Its price-to-earnings ratio is a bit less than 20 -- again, this seems somewhat expensive in light of analysts' forecasts for 13% long-term earnings growth and its 3% dividend yield. Finally, its free cash flow is roughly equal to its net income at present, giving it a price-to-FCF ratio of 20. While I find none of these valuations alarmingly expensive, neither do any of them scream "cheap" to me. For the time being, I'll be passing on Lockheed Martin stock. Before you buy stock in Lockheed Martin, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Lockheed Martin wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $672,177!* Now, it's worth noting Stock Advisor's total average return is 815% — a market-crushing outperformance compared to 162% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of March 24, 2025 Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy. Why Is the U.S. Air Force Buying $1.9 Billion in New Missiles From Lockheed Martin? was originally published by The Motley Fool Sign in to access your portfolio
