Northrop Wins $267M Contract to Support MQ-4C Triton UAS

Northrop Grumman Corp.’s NOC business unit, Northrop Grumman Systems Corp, recently clinched a modification contract involving the MQ-4C Triton unmanned air systems (“UAS”) program. The award has been provided by the Naval Air Systems Command, Patuxent River, MD.Details of the Deal Valued at $267.2 million, the contract is projected to be completed by October 2028. The latest modification requires Northrop to manufacture and deliver two MQ-4C Triton unmanned air systems. In addition to these jets, NOC will also be providing the U.S. Navy with a main operating base along with associated support, related technical and administrative data services. The contract also includes delivery of MQ-4C spare parts for the government of Australia. A major portion of work related to this deal will be carried out in Rancho Bernardo and Palmdale, CA, as well as in Red Oak, TX.  What’s Favoring NOC?Enhanced intensity of geopolitical tensions worldwide lately, like the Russian invasion of Ukraine as well as the ongoing conflict in the Middle East, has prompted nations to strengthen their defense systems manifold. With aerial security playing a key role as one of the primary pillars in defending a nation’s border safety, increased investments in combat air systems have been observed over the past decade. As investments in combat air systems surge, the increased adoption of UAS has become an integral part of modern warfare strategies, driven by rapid technological advancements. Notably, UAS offers a dual advantage—enhancing surveillance and combat effectiveness while significantly reducing risks to human life. Their ability to conduct intelligence gathering, reconnaissance and precision strikes without exposing pilots to hostile environments makes them a cost-effective and efficient defense tool. As a result, UAS manufacturers like Northrop are witnessing a steady stream of contracts for their state-of-the-art unmanned aircraft, with the latest contract win serving as a notable example. Notably, NOC’s MQ-4C Triton UAS provides real-time intelligence, surveillance and reconnaissance (ISR) over vast ocean and coastal regions. It supports a wide range of missions, including maritime ISR patrol, signals intelligence, search and rescue and communications relay. What Lies Ahead for NOC?The growth prospects for the global unmanned combat aerial vehicle (UCAV) market remain promising backed by increasing defense budgets and rising warfare situations, along with cross-border conflicts among neighboring countries. This must have prompted the Morder Intelligence firm to predict that the global UCAV market will witness a CAGR of more than 8% during the 2025-2030 time period.Such solid market projections indicate strong growth opportunities for NOC, which has a handful of autonomous systems in its product portfolio, like RQ-4 Global Hawk, NATO Alliance Ground Surveillance, and MQ-8B and MQ-8C Fire Scout, in addition to MQ-4C Triton. The company is also a leading provider of sustainment, modernization and training services for unmanned aircraft systems for the U.S. military and a broad range of international customers.Peer ProspectsOther defense primes that should also benefit from the solid growth opportunities offered by the global UCAV market are mentioned below: RTX Corp. RTX: Its Coyote UAS is equipped with an advanced seeker and warhead that can successfully identify and eliminate threat UAS. It is ideal for improved surveillance imagery, enhanced targeting capability, near real-time damage assessment and reduced threat to manned aircraft.RTX boasts a long-term earnings growth rate of 9.7%. The Zacks Consensus Estimate for its 2025 sales implies an improvement of 4.4% from the 2024 reported figure.Kratos Defense & Security Solutions KTOS: Its XQ-58 Valkyrie is a high-performance, survivable, tactical UCAV capable of long-range flights at high-subsonic speeds. The company also manufactures the X-61A Gremlin Unmanned Aerial Vehicle, which conducts airborne launch and recovery of groups of UAS from existing large aircraft as well as fighters and other small fixed-wing aircraft.The company delivered an average four-quarter average earnings surprise of 69.24%. The Zacks Consensus Estimate for its 2025 sales implies an improvement of 12.6% from the 2024 reported figure.Lockheed Martin LMT: It has a vast portfolio of autonomous systems, including Indago UAV and Stalker UAS. Moreover, its MATRIX technology enables rotary and fixed-wing aircraft to be flown with or without humans on board, depending on the mission.LMT boasts a long-term earnings growth rate of 7.8%. The Zacks Consensus Estimate for 2025 sales implies an improvement of 4.6% from the 2024 reported figure.Price PerformanceIn the past month, shares of NOC have surged 11.8% compared with the industry’s 1.8% rise.Image Source: Zacks Investment ResearchZacks RankNorthrop currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 Lockheed Martin Corporation (LMT): Free Stock Analysis Report Northrop Grumman Corporation (NOC): Free Stock Analysis Report Kratos Defense & Security Solutions, Inc. (KTOS): Free Stock Analysis Report RTX Corporation (RTX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks