RTX Secures $104M ESSM Deal, Strengthens Global Missile Leadership

RTX Corporation’s RTX business segment, Raytheon, recently secured a contract to provide technical and design agent engineering support for the Evolved SeaSparrow Missile (“ESSM”) and NATO SeaSparrow Missile Systems programs. The deal has been provided by the Naval Sea Systems Command, Washington, D.C.

The contract, worth nearly $104.1 million, is slated for completion by Dec. 31, 2026. A major portion of the work related to this deal will be carried out in Tucson, AZ, and Portsmouth, RI.

This contract combines purchases for the U.S. Navy along with the governments of many other countries.

An Overview of RTX’s ESSM Missiles

RTX’s ESSM missile has established itself as a benchmark international production and development program, meeting the requirements of both partner navies and third-party customers. The missile is deployed across multiple combat systems, radar, fire-control and launcher configurations at sea.

ESSM delivers dependable ship self-defense against agile, high-speed, low-altitude anti-ship cruise missiles, low-velocity aerial threats such as helicopters and fast, maneuverable surface threats. With more than 330 successful live firings at sea, ESSM is a proven and highly reliable defense solution against a broad and challenging threat spectrum. These strong capabilities are likely to keep boosting sustained demand for the missile.

Growth Potential for RTX

Rising regional conflicts worldwide are driving nations to bolster their defense capabilities. With missiles playing a vital role in modern military arsenals, countries are ramping up investments in advanced missile systems for both defensive and deterrence needs.

The Mordor Intelligence firm predicts that the global market for missiles and missile defense systems will witness a CAGR of 4.97% between 2025 and 2030. This outlook bodes well for RTX, which boasts a diverse portfolio of combat-proven missiles such as the SM-6, National Advanced Surface-to-Air Missile System, Tomahawk cruise missile, SM-2, AIM-9X Sidewinder, Naval Strike Missile and a few more.

Opportunities for Other Defense Companies

Other defense contractors poised to benefit from the growth opportunities in the missiles and missile defense systems market include the following:

Northrop Grumman Corp. NOC: The company provides high-speed, long-range strike weapons like the AARGM-ER, a supersonic, air-launched tactical missile. It also designs and manufactures warheads, fuses, advanced high-speed propulsion systems and other critical missile components.

NOC has a long-term (three to five years) earnings growth rate of 4.19%. The Zacks Consensus Estimate for 2025 sales stands at $41.88 billion, which calls for an increase of 2.1%.

Lockheed Martin Corp. LMT: The company’s Missiles and Fire Control segment focuses on the development, production and sustainment of advanced missile and rocket systems. Its prominent offerings include the PAC-3 missile family, Spike NLOS, the Precision Strike Missile and the Terminal High Altitude Area Defense and a few more.

LMT has a long-term earnings growth rate of 11.94%. The Zacks Consensus Estimate for 2025 sales stands at $74.44 billion, which calls for an increase of 4.9%.

The Boeing Company BA: The company provides air and missile defense solutions to the United States, allied nations and international partners, with a portfolio that includes advanced systems such as Aegis Ballistic Missile Defense and Ground-Based Midcourse Defense.

BA boasts a long-term earnings growth rate of 31.33%. The Zacks Consensus Estimate for 2025 sales stands at $87.26 billion, which implies a jump of 31.2%.

RTX Stock Price Movement

In the past six months, RTX shares have risen 26.8% compared with the industry’s growth of 13.1%.

RTX’s Zacks Rank

RTX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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