Northrop Grumman announced Friday that it has been awarded a $2.4 billion contract from the U.S. Navy to build a next-generation amphibious assault ship called the LHA 6. The ship will be designed and constructed at Northrop's Pascagoula, Mississippi shipyard and is expected to be delivered in 2012. The replacement ship will improve on the LHD 8 ship, currently under construction at Northrop, by offering a bigger hangar deck, realigned and expanded maintenance facilities, a larger cargo magazine, and greater aviation fuel capacity. It will be capable of supporting a detachment of over 20 Joint Strike Fighters. Like the LHD 8, the LHA 6 will be able to act as flagship for an expeditionary strike group. Corporate VP Philip Teel and president of the company's Ship Systems unit: "This contract award reinforces the U.S. Navy's confidence that we have recovered from the effects of Hurricane Katrina and are capable of meeting the warfighters' needs in a timely and cost effective manner."
Sources: Press release, MarketWatch, Reuters, Forbes
Commentary: Northrop Grumman Shares Fall On Earnings Miss • Defense Stocks: P/E Isn't the Only Consideration • DoD's FY-08 Budget: The Largest in US History
Stocks/ETFs to watch: Northrop Grumman Corp. (NYSE:NOC). Competitors: Boeing Co. (NYSE:BA), General Dynamics Corp. (NYSE:GD), Lockheed Martin Corp. (NYSE:LMT). ETFs: iShares Dow Jones US Aerospace & Defense (NYSEARCA:ITA), PowerShares Aerospace & Defense (NYSEARCA:PPA), PowerShares Dynamic Industrials (NYSEARCA:PRN)
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