BAE Systems Expands Maritime Capabilities With Sea Domain Innovations

BAE Systems Plc (BAESY), a prominent defense contractor, continues to innovate across naval platforms by delivering high-tech solutions that cover everything from surface combatants to undersea vessels. These innovations are part of its Sea business division, which focuses on designing, manufacturing and supporting a comprehensive range of naval systems, including ships, submarines, torpedoes, radars and fully integrated combat systems.

In June 2025, BAE Systems opened a new submarine engineering hub in Coventry, marking a significant expansion of its defense operations. The state-of-the-art facility will focus on critical engineering work to support the UK's next-generation nuclear-powered attack submarines, known as the SSN-AUKUS program.

Additionally, BAE Systems launched the HMS Glasgow in May 2025, the first of eight advanced Type 26 frigates built for the Royal Navy. Designed for anti-submarine warfare, these vessels feature a Mk 45 gun and Ammunition Handling System, as well as cutting-edge radar and sonar systems.

The company also continuously focuses on investing in and developing the latest boat technologies, integrating the newest innovations such as autonomy, composite materials, stealth, ballistic protection and electronics into its designs.

Innovations of Other Defense Stocks

As more investments are pouring into the global naval defense economy, growth prospects remain solid for other defense stocks like Lockheed Martin Corporation (LMT) and Huntington Ingalls Industries (HII), which are also innovating and developing new maritime products.

Per a report published in April 2025 by Lockheed, it is innovating the future of U.S. Navy surface combatant Counter Unmanned All Domain Systems capabilities through a collaborative effort leveraging fielded and proven combat system, effector and launcher technology across the corporation. Lockheed plans to conduct its first demonstrations of the Joint Air-to-Ground Missile Quad Launcher prototype in 2025 to validate its design and performance.

Northrop Grumman is expanding its presence in maritime defense with cutting-edge autonomous systems. Its recent maritime innovations include the Manta Ray, a large undersea drone designed for long-duration missions, which is currently in development and testing phases.

The Zacks Rundown for BAESY

Shares of BAESY have gained 58.6% in the past year compared with the industry’s 49.9% growth.

The company shares are trading at a discount on a relative basis, with its forward 12-month Price/Earnings being 23.96X compared with its industry’s average of 47.39X.

The Zacks Consensus Estimate for BAESY’s 2025 and 2026 earnings has improved over the past 60 days.

BAESY stock currently carries a Zacks Rank #2 (Buy).

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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