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ANDOVER, Mass. - Defense contractor Raytheon, a business unit of RTX (NYSE: RTX), a $185.8 billion market cap aerospace and defense giant with $81.7 billion in annual revenue, has received a $646 million contract to continue manufacturing the AN/SPY-6(V) radars for the U.S. Navy. This latest agreement, announced today, is part of a larger March 2022 contract potentially worth up to $3 billion over a five-year span.
With this new contract, the U.S. Navy will acquire four additional AN/SPY-6(V) radars, bringing the total number of radars ordered to 42. The AN/SPY-6(V) is touted as the Navy’s most advanced maritime radar and is expected to enhance the Navy’s capabilities by providing sailors with increased detection range. According to InvestingPro data, RTX’s stock is trading near its 52-week high of $140.65, reflecting investor confidence in the company’s defense contracts and market position.
Barbara Borgonovi, president of Naval Power at Raytheon, emphasized the significance of the SPY-6 radar, stating it allows the Navy "to see further than they’ve ever seen before," which translates into more reaction time for sailors when threats are detected.
The radar systems are developed and produced at Raytheon’s Radar Development Facility in Andover, Massachusetts. This 30,000-square foot facility is recognized for its advanced production capabilities, including a high degree of automation and around-the-clock radar testing and integration.
The majority of the work related to this contract is slated to be carried out at the Andover site and is expected to continue through 2028.
Raytheon is known for its extensive history in defense, providing a range of solutions in missile defense, smart weapons, advanced sensors, radars, and other technologies. RTX, Raytheon’s parent company, is a major player in the aerospace and defense industry, employing over 185,000 people globally.
The information for this article is based on a press release statement.
In other recent news, Raytheon, a business unit of RTX, has secured a $1.1 billion contract from the U.S. Navy for the production of AIM-9X Block II missiles, marking a significant milestone for the program. This contract will increase production to 2,500 missiles annually. In addition, Raytheon received a $536 million contract to support the SPY-6 family of radars, which includes upgrades to destroyers and software enhancements. The radar system is expected to be deployed on over 60 U.S. Navy ships over the next decade. Furthermore, Raytheon was awarded a $1.1 billion contract modification for the AIM-9X production Lot 25 requirements, with allocations for the Navy, Air Force, and Foreign Military Sales customers. Analysts at TD Cowen have raised RTX’s stock price target to $155, citing potential margin expansion and a low relative valuation as positive factors. They also noted that recent tariff reductions might offer some relief against anticipated financial headwinds. Additionally, the proposed Golden Dome defense program, which RTX could potentially be involved in, was highlighted as a significant defense initiative with an estimated 20-year cost of $831 billion. This program aims to integrate space-based interceptor satellites for missile defense, alongside other defense layers.
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