RTX Secures a $647M Contract to Support AN/SPY-6(V) Family of Radars

RTX Corporation’s RTX business segment, Raytheon, recently secured a modification contract worth $646.5 million to exercise options for hardware production of the AN/SPY-6(V) family of radars. The award has been offered by the Naval Sea Systems Command, Washington, D.C.

A major portion of the work related to this deal will be executed in Andover, MA; San Diego, CA; Sykesville, MD; and Scottsdale, AZ. The contract is projected to be finished by September 2028.

Importance of RTX’s AN/SPY-6(V) Family of Radars

RTX’s AN/SPY-6 is a variant of its SPY-6 radar family that can protect against ballistic missiles, cruise missiles, hostile aircraft and surface ships at the same time. They offer various advantages over conventional radars, including a longer detection range, higher sensitivity and more accurate discrimination.

Its solid demand is evidenced by the fact that SPY-6 radars are being delivered and integrated onto all the Navy’s newest ships, including DDG 51 Flight III destroyers, frigates, aircraft carriers and amphibious warships.

RTX’s Growth Opportunities

Rising geopolitical tensions, increased defense spending and the need for advanced threat detection are driving demand for military radars. This must have prompted the Mordor Intelligence firm to project a CAGR of 5.2% for the military radar market in the 2025-2030 period. Such growth projections bode well for prominent radar manufacturers like RTX.

RTX’s product portfolio consists of varied radars, such as AN/TPY-2, AN/APG-79, APG-82(V)1, GhostEye MR and a few more, which enjoy solid demand in the global military radar market.

Opportunities for Other Defense Stocks

Some other defense contractors that manufacture radars and are thus projected to gain from the expanding global military radar market have been discussed below:

Lockheed Martin Corp. LMT: The company’s radars are the choice of more than 45 nations across six continents. Its product portfolio consists of varied radars like TPY-4, AN/APY-9 Radar, AN/TPQ-53 Radar System, SPY-7, TPS-77 and Sentinel A4.

LMT has a long-term (three to five years) earnings growth rate of 10.5%. The Zacks Consensus Estimate for the company’s 2025 sales indicates year-over-year growth of 4.7%.

Northrop Grumman Corp. NOC: The company is a pioneer in manufacturing Active Electronically Scanned Array radars, with more than 60 years of experience. Its diverse product portfolio also includes a handful of radars like AN/ZPY-5 VADER, AN/TPS-80 G/ATOR, AN/SPQ-9B and HAMMR.

Northrop has a long-term earnings growth rate of 3.3%. The Zacks Consensus Estimate for the company’s 2025 sales indicates year-over-year growth of 2.8%.

L3Harris Technologies, Inc. LHX: The company’s product portfolio includes the SPS-48 land-based surveillance radar, AN/APY-11 Multimode radar, Tactical Air Surveillance radar, AN/SPS-48G Long range 3D surveillance radar and many more.
 
L3Harris has a long-term earnings growth rate of 12%. The Zacks Consensus Estimate for LHX’s 2025 sales implies an improvement of 1%.

RTX Stock Price Movement

In the past year, shares of RTX have risen 31.8% compared with the industry’s growth of 15.5%.

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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