Lockheed Gets $90M PBL Contract - Analyst Blog
18 Janvier 2013 - 5:15PM
Zacks
Lockheed Martin
Corporation (LMT) won a $90.6 million U.S. Army contract
for providing maintenance services to the Modernized Target
Acquisition Designation Sight/Pilot Night Vision Sensor
(“M-TAD/PNVS”).
The firm-fixed price contract is
the first of three options falling under the Performance Based
Logistics (PBL) project, valued at $111 million and conferred in
2012. The total value of the contract is $375 million and will be
carried out in four years.
The PBL is a strategic model
exercised by the U.S. Department of Defense ("DoD") that offers
product system support and sustainment. The program boosts the
quality of system readiness, accentuates mission effectiveness,
lowers operation and support expenses and enhances the situational
awareness and flying skills of the Apache helicopter pilots as
provided by the M-TAD/PNVS.
The M-TAD/PNVS is a cutting-edge
electro-optical fire control feature that allows Apache pilots to
fly safely during day and night and also in missions during extreme
weather conditions.
The M-TAD/PNVS contract enables
Lockheed Martin to deliver high-quality, reliable and efficient
products to the fighter pilots and at the same time minimizes
costs.
Lockheed Martin collected a string
of such logistics and support contracts in Jan 2013. The key deals
include a $73.7 million contract from the U.S. Hill Air Force Base
for providing support for the maintenance and repair of the F-22
fighter jets and a $104 million U.S. Air Force Space Command Space
and Missile Center contract for supporting the ground control
systems in the Global Positioning System (“GPS”) programs.
Despite the likelihood of spending
cuts in the defense sector, we believe Lockheed Martin’s top-line
could witness significant upside given its strong order backlog of
$75.6 billion. Additionally, the company’s diversified operations
in unmanned systems, cyber-security force protection, and missile
defense would enhance its sales potential.
We note that the DoD’s spending on
PBL has increased substantially from $1.4 billion to $5.0 billion
over the period 2001 to 2009 and is projected to further increase
by 10.3% in 2013. This will certainly bode well for Lockheed
Martin’s business prospects. The company’s stock currently retains
a Zacks Rank #2 (Buy).
Another defense contractor who is
busy picking up logistics and support contracts is Zacks #3 Ranked
Northrop Grumman Corporation (NOC). The company
secured a $14.1 million contract from the Naval Systems Sea Command
to support system development and demonstration phase via
preliminary design evaluation for the Joint Counter
Radio-Controlled Improvised Explosive Device (“RCIED”) Electronic
Warfare (“JCREW”) 3.3 System.
Based in Bethesda, Maryland,
Lockheed Martin is a $30.45 billion company engaged in the
research, design, development, manufacture, integration, and
sustainment of advanced technology systems and products.
LOCKHEED MARTIN (LMT): Free Stock Analysis Report
NORTHROP GRUMMN (NOC): Free Stock Analysis Report
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