Raytheon Co. (RTN) has recently won a $251.1 million contract from the U.S. Navy to secure 231 Tomahawk Block IV tactical cruise missiles for fiscal 2014 with an option for 2015.
Under the contract, Raytheon will build and deliver Tomahawk Block IV cruise missiles to the U.S. Navy and U.K. Royal Navy and will also conduct flight tests and provide life-cycle support services. The delivery of the missiles is slated to begin in 2015.
This Waltham, MA-based company’s Tomahawk cruise missile is President Barack Obama’s weapon of choice in the latest round of U.S. military strikes in Syria against the Islamic State militant group. Tomahawk has become an important weapon in the U.S. defense arsenal for its precise capability to take out high value target from a very long distance. These missiles have a range of 1,000 nautical miles (1,150 statute miles) and can be launched both from the surface and from submarines. The latest version, Block IV, has a satellite link that enables it to hover over the battlefield as it awaits target instructions.
Raytheon is one of the largest aerospace and defense companies in the U.S. with a diversified line of military products, including missiles, radars, sensors, surveillance and reconnaissance equipment, communication and information systems, naval systems, air traffic control systems, and technical services. It competes with the likes of Lockheed Martin Corp. (LMT), General Dynamics Corp. (GD) and Northrop Grumman Corp. (NOC).
Although budget sequestration has taken its toll on defense contractors, the fiscal 2015 budget request protects most of Pentagon's major programs, retiring some older aircraft and helicopters and shedding a planned armored combat vehicle for the Army. New programs comprise revamping part of a ground-based missile-defense system currently built by Raytheon. The 2014 fiscal budget also puts emphasis on Raytheon’s prominent programs including Missile and Space Systems, thereby providing a cushion to its revenue stream.
Recently, Raytheon received a $109 million contract from the U.S. Army Aviation and Missile Command, Redstone Arsenal, AL. Per this Engineering Service contract, Raytheon will keep the Patriot Air and Missile Defense System battle ready for the U.S. Army and foreign military customers (read more: Raytheon Gets Service Contract for Patriot Defense System).
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