Boeing to Provide End Item Equipment for F/A-18 Aircraft
The Boeing Company BA recently
secured a $36.8-million contract for providing 82 end item
equipment for supporting F/A-18 aircraft’s Return-to-Readiness
Initiative. The contract was awarded by the Naval Air Warfare
Center Aircraft Division, Lakehurst, NJ.
Work related to this deal will be performed in St. Louis, MI, and
is expected to get completed by March 2021.
A Brief Note on F/A-18 Aircraft
Boeing’s F/A-18 Block III Super Hornet is a twin-engine,
supersonic, all weather multirole fighter jet, capable of
performing day/night striking with precision-guided weapons,
fighter escort, suppression of enemy air defenses, maritime strike,
reconnaissance and forward air control and tanker missions.
Our View
Owing to widespread geopolitical tensions across the globe, Boeing
has been witnessing strong demand for its fighter aircraft and
major aerospace programs, including the F-18 program. Evidently,
the company's backlog for its defense business stood at $57 billion
toward the end of 2018, witnessing a year-over-year increase of
30%. Significant orders acquired by the company for its F/A-18
program contributed to this backlog growth. Inevitably, Boeing's
F/A-18 program is anticipated to witness considerable growth in
2019 as well, through contract wins like the latest one. Such deals
in turn will drive the company's top line.
Interestingly, the proposed fiscal 2020 defense budget that
includes a spending plan of $57.7 billion on aircraft reflects a
massive increase of 166% from the approved spending for fiscal
2019. If approved, this increased spending provision should usher
in more contracts for Boeing’s F/A-18 aircraft program, going
ahead.
Price Performance
Shares of Boeing have rallied 23.8% in the past 12 months against
the industry’s decline of 1.4%.
Zacks Rank & Key Picks
Boeing currently carries Zacks Rank #3 (Hold). A few better-ranked
stocks in the same sector are Spirit Aerosystems Holdings SPR,
AeroVironment, Inc. AVAV and Heico Corporation HEI.
While Spirit Aerosystems sports a Zacks Rank #1 (Strong Buy), Heico
and AeroVironment carry a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank stocks
here.
Spirit Aerosystems’ long-term growth estimates currently stand at
7.8%. The Zacks Consensus Estimate for 2019 earnings has risen 3.7%
to $7.56 in the past 90 days.
Heico Corporation came up with average positive earnings surprise
of 4.8% in the last four quarters. The Zacks Consensus Estimate for
2019 earnings has increased 2.9% to $2.14 in the past 90
days.
AeroVironment’ long-term growth estimates currently stand at 25%.
The Zacks Consensus Estimate for 2019 earnings has risen 16.67% to
$1.75 in the past 90 days.
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The Boeing Company (BA) :
Free Stock Analysis Report
Spirit Aerosystems
Holdings, Inc. (SPR) : Free Stock Analysis Report
Heico Corporation (HEI) :
Free Stock Analysis Report
AeroVironment, Inc. (AVAV)
: Free Stock Analysis Report
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