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Textron Inc.’s TXT business unit, Bell, secured a contract to aid the UH-1Y and AH-1Z helicopters. The award has been offered by the Naval Air Systems Command, Patuxent River, MD.
Details of TXT’s Deal
Valued at $13 million, the contract is expected to be completed by December 2025. Per the terms of the deal, Textron will provide program management, engineering and logistics services for upgrading and sustainment of the AH-1Z Viper and UH-1Y Venom helicopters.
This contract will serve the U.S. Marine Corps as well as the governments of Bahrain and the Czech Republic. The majority of the work related to this deal will be carried out in Fort Worth, TX.
What’s Favoring TXT Stock?
With global defense spending rising amid growing hostilities across the world, investment in advanced defense products, including military helicopters, has also been increasing. These helicopters are crucial for air warfare missions. This has been providing ample opportunities for Textron to win production and modification contracts for its combat-proven helicopters in recent times. The latest contract is an example of that.
Notably, Textron’s AH-1Z helicopter is the only attack helicopter in the world with fully integrated air-to-air missile capability. With a speed of 200 knots and a range of 310 nautical miles, this helicopter can serve attack, aerial reconnaissance and escort missions for the military.
Moreover, TXT’s UH-1Y helicopter is known for its advanced avionics and robust performance. It excels in roles such as troop transport, search and rescue, and close air support, making it an essential asset for modern military operations.
These features of the aforementioned helicopters and the growing demand for military helicopters are likely to have been ushering in notable contracts for TXT, like the latest one. Such contract wins are likely to boost revenues from the Bell unit, which registered a solid 23.2% year-over-year revenue growth in the last reported quarter.
Growth Prospects for TXT Stock
Rising military conflicts, terrorism and border disputes, along with rapid technological advancements in military helicopters, have led nations to increase their defense spending, with combat-proven helicopters constituting an integral part of a nation’s defense structure.
This is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of more than 2.9% for the military helicopter market during the 2024-2030 time period.
Such solid market prospects offer growth opportunities for Textron, with its Bell unit offering a robust portfolio of combat-proven helicopters like the Bell 360, V-280, V-22 and many more.