MCLEAN, Va. - Huntington Ingalls Industries (NYSE: NYSE:HII) has been awarded a $458 million contract to modernize the U.S. Department of Defense's communications and information technology networks, a move aimed at enhancing rapid decision-making capabilities in the battlespace. The contract was announced today and involves HII's Mission Technologies division.
Under the five-year task order, HII will develop and implement new technical solutions to bolster system security against cyber threats, introduce advanced capabilities, and facilitate cloud migration. These improvements are designed to provide U.S. Department of Defense service components and the U.S. Special Operations Command with robust IT services and solutions to support warfighters in the field.
Andy Green, executive vice president of HII and president of Mission Technologies, expressed the company's commitment to advancing the IT transformation goals of the U.S. government and ensuring a direct, positive impact on front-line warfighters.
The modernization efforts will include model-based systems engineering focusing on communication hardware prototyping, waveform development, mobile ad-hoc network aerial relay solutions, and deployable communication kits. Additionally, the team will work on spectrum and bandwidth management and develop capabilities to modernize communications and data analytics at the tactical edge.
Todd Gentry, president of Mission Technologies' C5ISR business group, highlighted the importance of equipping warfighters with integrated ISR capabilities to achieve information superiority, which is critical for homeland defense and protecting U.S. interests abroad.
The task order was awarded under the Department of Defense's Information Analysis Center Multiple Award Contract (MAC) vehicle, managed by the U.S. Air Force's 774th Enterprise Sourcing Squadron. This program aims to enhance the Defense Technical Information Center repository and support the research and development community within the DoD.
HII is a global defense provider, known as the nation's largest military shipbuilder, and employs a workforce of 44,000. The company's extensive portfolio includes ships, unmanned systems, cyber, ISR, AI/ML, and synthetic training solutions.
This contract announcement is based on a press release statement and reflects the author's views, not necessarily those of the Department of Defense.
In other recent news, Huntington Ingalls Industries (HII) has been the subject of several noteworthy developments. TD Cowen has reaffirmed its Buy rating on HII, maintaining a steady price target of $290.00, despite anticipating a $500 million reduction in future cash flow projections for 2024 due to delayed negotiations for 17 submarines with the U.S. Navy. The firm also predicts potential adjustments to earnings per share estimates due to increased sales from the company's Mechanical Tubing segment.
HII has also secured an expanded credit facility of $1.7 billion, as well as a record second-quarter revenue of $3 billion for 2024, reflecting a 6.8% increase from the previous year. The company reported a rise in diluted earnings per share to $4.38, up from $3.27 in the same quarter of 2023.
In addition, HII has been awarded several contracts, including a $30 million task order to support the U.S. Air Force's presidential and executive aircraft fleet, and a $209 million contract for the support of the U.S. Air Force's fighter and bomber weapons systems. However, JPMorgan has shifted its rating from "Overweight" to "Neutral" for HII, citing concerns about near-term confidence, while increasing its price target for the company's stock to $285.
HII has also delivered two REMUS 620 uncrewed underwater vehicles to the National Oceanic and Atmospheric Administration for high-resolution ocean floor mapping. These are among the recent developments for HII.
InvestingPro Insights
Huntington Ingalls Industries' recent $458 million contract award aligns with its strong financial performance and market position. According to InvestingPro data, HII boasts a market capitalization of $10.36 billion and a revenue of $11.78 billion over the last twelve months as of Q2 2024, with a notable revenue growth of 8.04% during the same period.
An InvestingPro Tip highlights that HII is trading at a low P/E ratio relative to its near-term earnings growth, with a current P/E ratio of 13.98. This suggests that the stock may be undervalued considering its growth prospects, which could be further bolstered by this significant contract win.
Another InvestingPro Tip reveals that HII has raised its dividend for 12 consecutive years, demonstrating a commitment to shareholder returns. This is particularly noteworthy given the company's ability to secure large government contracts while maintaining a strong dividend policy.
For investors seeking a deeper understanding of HII's financial health and growth potential, InvestingPro offers 7 additional tips, providing a comprehensive analysis of the company's prospects in the defense sector.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.