Lockheed Martin Corporation LMT recently clinched a modification contract for providing continued flight test support for Foreign Military Sales (FMS). The award has been provided by the Naval Air Systems Command, Patuxent River, MD.

Details of LMT’s Deal

Valued at $17.9 million, the contract is expected to be completed by March 2027. Per the terms of the deal, Lockheed can exercise options to provide continued flight test support, which includes but is not limited to maintaining and supporting aircraft by replacing broken parts, performing scheduled checks and maintenance, conducting safety inspections, replacing perishables and maintaining developmental lab infrastructure to enable testing.

The work related to this deal will be executed in multiple locations including Fort Worth, TX; Palmdale, CA; Patuxent River, MD and Orlando, FL.

LMT’s Expertise in the MRO Market

With nations across the globe spending heftily to secure their borders, fighter jets are playing key roles in defending a country’s aerial safety. This has been boosting the demand for fighter jets. With rising demand for new combat aircraft, the need for maintenance, repair and overhaul (MRO) services is also increasing.

This must have prompted the Mordor Intelligence firm to predict that the global military aviation MRO market will increase from $42.49 billion in 2025 to $48.81 billion by 2030 at a CAGR of 2.8%.

Such growth opportunities offered by the aforementioned market are likely to bode well for Lockheed. Its expertise in aircraft MRO services, combined with its advanced aviation solutions, positions it as an important player in supporting military aircraft.

LMT’s Sikorsky unit has an Overhaul and Repair organization, which offers a diversified range of system services, repairing and overhauling dynamic systems, blades, avionics and numerous other components, from aircraft tip to tail. Such extensive capabilities likely play an important role in LMT securing significant combat aircraft-related MRO contracts like the latest one.

Notably, in September 2024, LMT joined forces with Australia’s Asia Pacific Aerospace company to support the Black Hawk global supply chain for boosting this fleet’s advanced repair services.

Opportunities for Other Defense Companies

Other defense contractors that are anticipated to benefit from the expanding military aviation MRO market are discussed below.

RTX Corporation RTX: The company’s Pratt & Whitney unit is a well-known provider of combat aircraft MRO services. In October 2024, Pratt & Whitney opened its new 845,000-square-foot facility worth $255 million in Oklahoma City, OK, to meet the growing demands of both U.S. and global defense customers for the F135, F117, TF33, F100 and F119 engines.

RTX has a long-term (three to five years) earnings growth rate of 10.3%. The Zacks Consensus Estimate for RTX’s 2025 sales indicates year-over-year growth of 5.4%.

BAE Systems BAESY: It offers comprehensive support, including spare parts, repairs and cutting-edge systems like engine control, head-up displays and cabin systems, thereby ensuring aircraft remain operational, safe and equipped with the latest technologies.

BAE Systems has a long-term earnings growth rate of 11.1%. The Zacks Consensus Estimate for BAESY’s 2025 sales indicates year-over-year growth of 58.4%.

AAR Corp. AIR: The company is the largest independent aerospace MRO provider in North America, serving a global customer base. In September 2024, AAR won a contract with an aggregate ceiling value of $1.2 billion to provide depot airframe maintenance and depot field team support for P-8A Poseidon jets.

AAR Corp. delivered an average earnings surprise of 3.90% in the last four quarters. The Zacks Consensus Estimate for the company’s fiscal 2025 sales indicates year-over-year growth of 19.5%.

LMT Stock’s Price Movement

Shares of LMT have risen 18.8% in the past year compared with the industry’s 2.5% growth.

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LMT’s Zacks Rank

LMT 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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