General Dynamics Information Technology, a business unit of General Dynamics Corporation (GD), has received a five-year indefinite-delivery, indefinite-quantity contract from the Carderock Division of the U.S. Navy's Naval Surface Warfare Center for the support of Hull, Mechanical and Electrical (“HM&E”) Machinery and Systems. If all options are exercised, the contract has a potential value of $73.3 million.
Under the contract, General Dynamics will be responsible for prototype engineering, design, development, testing, performance specifications and data analysis of the HM&E machinery and systems. The company will also supervise the system fault hierarchy and safety analysis, and will take charge of computer programming and software engineering of the machinery and systems on Navy vessels and selected land-based sites, as well as other federal agency and federally contracted vessels.
The company will also provide system training development and on-site technical support, alteration services, integrated logistics and staging to the Navy vessels of the Carderock Division, a leader in surface and undersea vehicle science that oversees full life-cycle support for maritime technologies.
Besides working for the contract in Norfolk, Virginia, San Diego and Philadelphia, the company will also perform the work at Hawaii, Guam, Japan, Bahrain, and Italy.
Based in Falls Church, Virginia, General Dynamics engages in mission-critical information systems and technologies; land and expeditionary combat vehicles, armaments and munitions; shipbuilding and marine systems; and business aviation. The company recently received provisional type certificate from the Federal Aviation Administration for its Gulfstream G650 aircraft. The company will now be able to begin interior completions of the ultra-large-cabin and ultra-long-range business jet for its delivery in the second quarter of 2012.
The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock. Similarly, its peers The Boeing Company (BA) and Textron Inc. (TXT) hold short-term Zacks #3 ranks (Hold).
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