MCLEAN, Va. - Huntington Ingalls Industries (NYSE: NYSE:HII) has secured a $74 million contract to enhance the missile-launching capabilities of U.S. Navy ships, the company announced today. The Mission Technologies division of HII will focus on research, development, and analysis for the Mk 41 and Mk 57 vertical launching systems (VLS), which are integral to the Navy's surface combatants.
The contract, awarded by the Naval Surface Warfare Center (NSWC) Port Hueneme Division, encompasses work on naval surface weapon systems, combat systems, and sensors. A notable aspect of this contract is the outfitting of the first Zumwalt-class destroyer (DDG 1001) with the latest Mk 57 VLS universal canister electronics unit, enabling any missile to be fired from any VLS cell on the ship.
Todd Gentry, president of HII's C5ISR business group, expressed the company's commitment to bolstering the Navy's defensive capabilities, stating that this technology provides warfighters with a significant advantage over adversaries.
The contract, which has a five-year term, was awarded under the Department of Defense’s Information Analysis Center Multiple Award Contract (IAC MAC) vehicle. It aims to foster technological advancements and address obsolescence challenges in current systems. The majority of the work will be conducted in Syracuse, New York, and Arlington, Virginia.
This task order is a continuation of HII’s ongoing support to NSWC Port Hueneme, following a previous contract from 2021. HII, a global defense provider, is known for its role as the nation’s largest military shipbuilder and offers a wide range of defense solutions, including unmanned systems, cyber, ISR, AI/ML, and synthetic training.
The information for this article is based on a press release statement.
InvestingPro Insights
As Huntington Ingalls Industries (NYSE: HII) cements its partnership with the U.S. Navy through a new contract, investors have taken note of the company's strong financial metrics. A standout feature in the company's financial health is its perfect Piotroski Score of 9, indicating high-quality business operations. Moreover, HII's commitment to shareholder returns is evident in its consistent dividend track record, having raised its dividend for 12 consecutive years, and maintained payments for 13 years in a row. This is a testament to the company's stable financial management and its ability to generate reliable cash flows.
InvestingPro data reveals a robust picture of the company's valuation and performance. HII is currently trading at a P/E ratio of 16.17, which is considered low relative to its near-term earnings growth, suggesting that the stock may be undervalued. This is further supported by a PEG Ratio for the last twelve months as of Q4 2023 standing at 0.91, typically indicating that the stock's price is in line with its expected earnings growth. Additionally, the company has experienced a substantial price uptick over the last six months, with a 30.3% total return, highlighting investor confidence and market momentum.
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