Defense contractor Raytheon Company (RTN) announced that its unit Raytheon Missile Systems Co. has won a contract worth $165.3 million from the U.S. Department of Defense.
As per the contract, the Missile Systems wing of Raytheon will be involved in the development of Standard Missile-3 Block IIA missile. The company will provide engineering services and material for systems engineering, and will also be involved in the design and initial hardware fabrication for the missile program.
Raytheon Missile Systems is working with Japan’s Ministry of Defense, Mitsubishi Heavy Industries and the Missile Defense Agency to develop Standard Missile-3 Block IIA. The new missile will provide the army a greater engagement capability against a wider variety of ballistic missile threats and more flexibility in protecting U.S. and allied forces.
The Standard Missile-3 (SM-3) is being developed as a part of the Missile Defense Agency and the U.S. Navy’s sea-based Aegis Ballistic Missile Defense System. The SM-3 Block IIA is an upgraded version, an outcome of the U.S. and Japanese cooperative research program.
During the second quarter 2010, the Missile Systems unit notched almost 24% or $1,415 million of Raytheon’s total sales of $5,973 million. During the said quarter, the unit received orders worth $895 million from various agencies. The total backlog of this Raytheon unit at second-quarter end was $7,838 million, of which $6,296 million comprised funded backlog.
Raytheon currently retains a Zacks #3 Rank (short-term Hold rating). We presently maintain a Neutral rating on the stock.
Based in Waltham, Massachusetts, Raytheon Company, along with its subsidiaries, provides electronics, mission systems integration, and other capabilities in the areas of sensing, effects, and command, control, communications, and intelligence systems, as well as mission support services to its global customers.
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