Raytheon (RTN) Gets ELCAN Specter Contract From Australia

Raytheon Company's (NYSE:RTN) unit, ELCAN Optical Technologies, has won a contract worth $54 million from Australia's Department of Defense for the ELCAN Specter DR 1-4x dual role weapon sight. Raytheon will roll out deliveries later this year.

Foreign military contracts are a key vital growth driver at Raytheon. International bookings comprised 26.7% of total first-quarter bookings at the company, while international sales surged 17.1% year over year and represented 42% of its total backlog during the period.

Details of the Contract

ELCAN Specter has a 1x and 4x field-of-view range and will effectively replace the Australian Defense Force’s current 1.5x magnified sight on the advanced F88 rifles in the Land 125 Phase C program. Dual magnification will facilitate both long-range targeting and short-range rapid aiming in a single package. According to Raytheon, the DR 1-4x sights is expected to enhance soldiers' ability to observe and engage targets from a distance.

RAYTHEON CO Price

Other Defense Deals

Raytheon is one of the best-positioned large-cap defense players. The company will continue to gain traction on the back of its focus on technological innovation and improvement of its product offering, which ensures more contract wins and an enhanced growth trajectory.

The company has been enjoying a steady stream of contracts from government establishments. Recently, Raytheon has won a contract from the U.S. Navy for the production of Aegis Weapon System AN/SPY-1D(V) Radar Transmitter Group, Missile Fire Control System MK 99 equipment and associated engineering services. The contract is valued at $365.8 million.

Raytheon’s bookings in the first quarter increased 38.7% to $6.2 billion from $4.5 billion in the year-ago period. Thus, the company remains optimistic about its performance in 2016 backed by its robust backlog of $34.77 billion in the first quarter.

Zacks Rank & Key Picks

Raytheon is currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the same space include TransDigm Group Incorporated (NYSE:TDG) , CAE Inc. (TO:CAE) and BAE Systems (LON:BAES) plc (OTC:BAESY) . While TransDigm Group sports a Zacks Rank #1 (Strong Buy), both CAE Inc. and BAE Systems have a Zacks Rank #2 (Buy).