Lockheed’s competitor L3Harris nabs $3 billion U.S. special operations contract

U.S. Special Operations Command (USSOCOM) awarded a contract under the Armed Overwatch program on August 1 to L3Harris Technologies (NYSE: LHX) and their Air Tractor’s AT-802U Sky Warden system. Notably, L3Harris beat out four other companies to capture this deal.  

This contract will include a ceiling of $3 billion, including delivery of 75 crewed, fixed-wing aircraft, with an initial contract award of $170 million. L3Harris’s CEO, Christopher E. Kubasik, stressed the importance of delivering modular solutions to U.S. special operators for their most challenging missions. 

“An important part of our Trusted Disruptor strategy is listening closely to combatant commanders’ needs, and responding faster than the evolving threats. We want to deliver game-changing, modular solutions to U.S. special operators for their hardest missions, and Sky Warden does just that.”

Sky Warden to the rescue 

The weapons and defense firm expects to provide a prototype for weapons testing in the next six months, while the contract’s performance period is from July 2022 to July 2029, including all options. 

Sean Stackley, the President of Integrated Mission Systems at L3Harris, explained the importance of the Sky Warden system for operational success in the field. 

“Sky Warden will bring powerful and affordable close air support, precision strike, armed ISR, and command and control capabilities directly to special operations forces on the battlefield. We are ready now to begin work on this modern, multi-mission system for the SOCOM Armed Overwatch program.”

The Armed Overwatch program will provide Special Operations Forces with an affordable and sustainable manned system for close air support, precision strikes, and armed intelligence.

LHX chart and analysis

It’s worth mentioning, that LHX ended yesterday’s trading session by only 0.43%, despite the news of a new contract.   

In the last month, LHX has been trading in the $218.58 to $244.29 range, remaining in the middle of its 52-week range.

The long-term trend is still neutral for LHX, but the short-term trend is positive, as the stock is getting more appreciated by traders and investors.

Weapon and defense companies are getting better contracts across the board, as investments into new weapon systems increased after Russia invaded Ukraine. Market participants looking to get exposure to this segment of the market could keep LHX on their watchlist as the company is increasing its portfolio of new contracts. 

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