Lockheed Martin Corporation (LMT) and the U.S. Air Force Research Laboratory ("AFRL") Munitions Directorate have entered into a five-year cooperative research and development agreement (“CRADA”) under which AFRL will assess the viability of Lockheed’s cooled tri-mode seeker for integration onto Air Force weapon platforms.
Lockheed’s tri-mode seeker has a semi-active laser sensor, an imaging infrared (“I2R”) sensor and millimeter wave radar into a single seeker with a common aperture. The cooled I2R sensor provides passive detection and helps in increasing warfighter survivability. All three sensor modes run simultaneously and have the capability to defeat moving and stationary targets on land, at sea, in adverse weather and in an obscured environment.
Lockheed Martin's cooled tri-mode seeker is based on three combat-proven weapon systems: Javelin, LONGBOW and HELLFIRE. It has recently defeated a variety of countermeasures and obscurants in a series of challenging and realistic battlefield environments.
The fourth generation seeker has gone through a number of laboratory, tower and captive-carry tests and has successfully proved itself in battlefield testing. All the three sensor modes cleared all tests and worked collaboratively to defeat each obscurant, targeting both moving and stationary targets.
Lockheed Martin has a platform-centric focus that guarantees a steady inflow of follow-on orders from a leveraged presence in the Army, Air Force, Navy and IT programs. Going forward, we believe Lockheed Martin has significant upside potential based on the Obama administration’s focus on Intelligence Surveillance Reconnaissance (ISR), unmanned systems, force protection, cybersecurity, and missile defense.
The company’s backlog could see further upside in the near future through satellite contracts for its Space Systems business and successful negotiation for further fixed contract F-35 follow-on orders.
Moreover, we believe market pessimism is fully accounted for in the current valuation. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.
Based in Bethesda, Maryland, Lockheed Martin is a global security company that employs about 126,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. Some of its main competitors are The Boeing Company (BA) and Raytheon Co. (RTN).
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