Raytheon Company (RTN) has installed the first Advanced Extremely High Frequency (“AEHF”) Secure Mobile Anti-jam Reliable Tactical Terminal (“SMART-T”) satellite communications solution at the U.S. armed services’ tactical units.
Raytheon plans to install approximately 364 AEHF SMART-T terminals for the U.S. armed services. Additionally, the company plans to install 19 systems in Canada and 7 in the Netherlands through 2015.
The Raytheon AEHF SMART-T will enhance the data rate of existing SMART-T systems four fold. The AEHF SMART-T upgrade will make use of the company’s eXtended Data Rate (“XDR”) waveform hardware and software modifications. AEHF SMART-T will increase the capacity to transmit voice, data and video thus enhancing situational awareness.
Raytheon is one of the best-positioned companies among the large-cap defense players because of its non-platform-centric focus. Revenue and earnings growth continue to be driven by a strong presence in the areas of Intelligence, Surveillance and Reconnaissance, air & missile defense systems, border security, air traffic management, training and homeland security, and cyber security.
Looking forward, the company enjoys strong order bookings and order backlog, an improving balance sheet, growing cash flow, and operational improvements.
These positives are, however, offset by apprehensions over future growth of the U.S. defense budget, the fate of high-cost programs, risks related to key project executions and order cancellations.The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.
Based in Massachusetts, Raytheon Company is a technology and innovation leader specializing in defense, homeland security and other government markets throughout the world. The company provides state-of-the-art electronics, mission systems integration and other capabilities in the areas of sensing; effects; and command, control, communications and intelligence systems, as well as a broad range of mission support services. The company mainly competes with The Boeing Company (BA) and Lockheed Martin Corporation (LMT).
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