Yahoo Finance Northrop Grumman (NOC) Secures Air Force Deal for AESA Radars
Northrop Grumman Corp.’s NOC business unit, Northrop Grumman Systems Corp. recently clinched a modification contract involving Active Electronically Scanned Array (AESA) radars. The award has been provided by the Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, OH.
Details of the Deal
Valued at $26.4 million, the contract is expected to be completed by Jul 31, 2025. Per the terms of the deal, Northrop will procure AESA radars for F-16 aircraft.
Work related to this deal will be carried out in Linthicum Heights, MD. The total cumulative face value of the contract is $1.24 billion.
A Brief Note on AESA
An AESA, also known as active phased-array radar, is a type of radar whose transmitter and receiver functions are composed of numerous small solid-state transmit/receive modules (TRMs). These radars help aircraft pilots to gain more detection range, providing "first detect" for air-to-air engagements and enabling first shoot/first kill by missiles fired through the Beyond Visual Range (BVR) mode.
Per management, Northrop has been at the forefront of AESA innovations for more than 60 years and currently offers more proven and affordable AESA solutions than anyone else. This, in turn, has enabled the company to be one of the top leaders in multi-mission radar solutions from sea to outer space.
Growth Prospects
Per Fortune Business Insights firm, the global military radar market is expected to reach $22.1 billion by 2028 at a CAGR of 6.3% from 2021. Such growth projections for the aforementioned market should benefit prominent radar manufacturers like Northrop, Raytheon Technologies RTX, Lockheed Martin LMT and L3Harris Technologies LHX.
Raytheon’s product portfolio consists of varied radars like integrated air and missile defense radars, ballistic missile radars, surveillance radars as well as air dominance radars. Radars like AN-SPY 6, AN-TPY-2, APG-79, APG-82 are some of its combat-proven products that enjoy solid demand in the global military radar market.
Raytheon boasts a long-term earnings growth rate of 10.4%. The Zacks Consensus Estimate for Raytheon’s 2022 sales implies an improvement of 6.1% from the 2021 reported figure.
Among Lockheed Martin’s notable radar portfolio, the significant ones include SPY-7, AN/TPQ-53 radar system and AN/APY-9 radar.
Lockheed boasts a long-term earnings growth rate of 5.4%. The stock has gained 22.1% in the past year.
Similarly, L3Harris is the manufacturing company for AN/SPS-48G naval radar, Symphony Airfield Radar Systems, Tactical Air Surveillance radars and a few more.
L3 Harris boasts a long-term earnings growth rate of 3.3%. The stock has gained 3.4% in the past year.
Price Movement
Shares of Northrop have gained 41.4% in the past 12 months against the industry’s decline of 32.8%.
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Zacks Rank
Northrop currently has 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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