Yahoo Finance Lockheed Martin (LMT) Wins $67.9M Modification Deal for SEWIP
Lockheed Martin Corp. LMT recently announced that its unit, Rotary and Mission Systems, clinched a modification contract for the full-rate production of the Surface Electronic Warfare Improvement Program’s (“SEWIP”) AN/SLQ-32(V)6 and AN/SLQ-32C(V)6 systems. The deal has been awarded by the Naval Sea Systems Command, Washington, DC.
Valued at $67.9 million, the contract is expected to be complete by December 2027. The majority of the work related to this deal will be carried out in Liverpool, NY.
What’s Favoring Lockheed Martin?
The rise in security threats and the changing dynamics of the defense world have led to increased defense spending on improved surveillance and countermeasure capability against naval threats like anti-ship missiles.
Backed by such demand and the need to make the electronic warfare threat detection system more prompt, SEWIP was introduced by Lockheed Martin. SEWIP was designed to provide enhanced electronic warfare capabilities to existing and new ship combat systems to improve anti-ship missile defense, counter-targeting and counter-surveillance capabilities.
With the capability to conduct both littoral and open-ocean electronic surveillance, SEWIP has been in the portfolio of the electric warfare system of the U.S. Navy for many years, and its demand may continue to increase manifold in the days ahead. Per a report from the Markets and Markets firm, the global electronic warfare system market is projected to witness a CAGR of more than 4.7% during the 2022-2027 period.
The expanding market size and the advantages of the electronic warfare system offered by LMT make SEWIP an attractive option for the Navy, thereby resulting in Lockheed Martin winning orders for the same, like the latest one. These developments are likely to boost the company’s revenue-generation prospects from the SEWIP electronic warfare system.
Peer Prospects
Apart from Lockheed Martin, defense companies that are likely to reap the benefits of additional spending on electronic warfare systems and thus witness a probable inflow of orders are as follows:
General Dynamics GD has been performing as the Lead Systems Integrator for SEWIP Block 1. Its SEWIP, a spiral-block development program, provides an immediate improvement for the legacy surface ship electronic warfare detection and countermeasure system, the AN/SLQ-32.
General Dynamics has a long-term (three to five years) earnings growth rate of 8.9%. The Zacks Consensus Estimate for GD’s 2023 earnings suggests an improvement of 3.7% from the prior-year reported figure.
Northrop Grumman’s NOC Block 3 SEWIP is an upgrade to the legacy AN/SLQ-32 system and provides the game-changing capability for non-kinetic electronic attack options to the U.S. fleet. The advantage of this electronic attack system is that it provides a non-kinetic, soft-kill magazine to defeat inbound threats.
Northrop’s long-term earnings growth rate is 3.8%. The Zacks Consensus Estimate for NOC’s 2023 earnings has moved upward by 2.1% in the past 60 days.
L3Harris Technologies’ LHX Viper Shield all-digital electronic warfare suite is custom designed to be a baseline on the advanced F-16 Block 70/72 aircraft and maximize survivability and mission success. Some other products of the company are AN/ALQ-161A, AN / ALQ-211 CV-22, NH 90, the F-16 self-protection system, the AN / ALQ-214 (IDECM) F/A-18 countermeasure system, etc.
LHX’s long-term earnings growth rate is 2.6%. The Zacks Consensus Estimate for the company’s 2023 sales indicates an improvement of 3.7% from the prior-year reported figure.
Price Movement
In the past year, shares of Lockheed Martin have increased 1.9% against the industry’s fall of 5.3%.
Image Source: Zacks Investment Research
Zacks Rank
Lockheed Martin 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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Lockheed Martin Corporation (LMT) : Free Stock Analysis Report
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