Boeing Secures $68M Air Force Deal to Support F-15 Program

Zacks Equity Research

The Boeing Company BA recently clinched a contract for supporting the foreign military sales requirement in relation to F-15 program for the Qatar Emiri Air Force. Work related to the deal is scheduled to be over by Dec 21, 2021.

Details of the Deal

Valued at $68.1 million, the contract was awarded by the Air Force Life Cycle Management Center, Wright-Patterson AFB, OH. Per the terms of the deal, Boeing will also provide maintenance and logistics support for aircraft and training devices conducting pre-delivery training.

Work related to this project will be executed inSt. Louis, MI.

A Brief Note on F-15

Boeing’s F-15 Strike Eagle is a twin-engine, all-weather tactical fighter aircraft. Its proven design is unbeatable in air-to-air combat, with more than 100 aerial combat victories.

What’s Favoring Boeing?

With rising security threats across the globe, developing economies like India, Qatar and a few more along with the developed nations like the United States and Europe are ramping up their arsenal. Being the largest jet maker, Boeing thus enjoys a smooth flow of contracts for military jets and its associated upgrades. The latest contract win is an example ofthe same.
Looking ahead, the U.S. fiscal 2020 defense budget allocation includes massive war-fighting investments worth $57.7 billion for military aircraft.

Given Boeing’s strength in combat-proven aircraft and rising global geo-political tension, the jet maker has higher chances of winning military-jet related contracts from the Pentagon like the latest one.

Price Movement

In a year’s time, Boeing’s shares have plunged 60.2% compared with the industry’s decline of 33.6%.

Zacks Rank & Key Picks

Boeing currently carries a Zacks Rank #4 (Sell).

A few better-ranked stocks in the same space are Leidos Holdings, Inc. LDOS, Huntington Ingalls Industries, Inc. HII and Lockheed Martin Corp. LMT. While Leidos Holdings sports a Zacks Rank #1 (Strong Buy), Huntington Ingalls and Lockheed carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Leidos Holdings delivered average positive earnings surprise of 11.19% in the trailing four quarters. The company has a long-term earnings growth estimate of 9.9%.

Huntington Ingalls Industries came up with positive earnings surprise of 2.83% in the last reported quarter. The Zacks Consensus Estimate for the company’s 2020 earnings indicates an annual improvement of 45.2%.

Lockheed delivered average positive earnings surprise of 15.91% in the trailing four quarters. The company has a long-term earnings growth estimate of 6.9%.

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