Leonardo DRS secures $117M army contract for thermal sights By Investing.com

ARLINGTON, Va. – Leonardo DRS, Inc. (NASDAQ:DRS) announced it has secured a $117 million production order for its next-generation thermal weapon sights from the U.S. Army. The order falls under the existing Family of Weapon Sights – Individual (FWS-I) Indefinite Delivery/Indefinite Quantity (IDIQ) contract.

The FWS-I utilizes Leonardo DRS’s uncooled thermal imaging technology and operates as a clip-on weapon sight that can wirelessly connect to helmet-mounted vision systems. These systems include the Enhanced Night Vision Goggle Binoculars and the Integrated Visual Augmentation System, both of which are designed to provide soldiers with rapid target acquisition capabilities. This technology is intended to enable users to engage targets effectively during the day, at night, and in various adverse environmental conditions.

Jerry Hathaway, Senior Vice President and General Manager of DRS’s Electro-Optical Infrared Systems business, stated, “This cutting-edge technology ensures soldiers will have the most advanced weapon sight systems on the battlefield today.” He emphasized the company’s pride in being recognized as a trusted partner by the U.S. Army to deliver critical technology to service members.

Leonardo DRS, headquartered in Arlington, VA, is known for its extensive portfolio of electro-optical and infrared technology utilized across the U.S. military. The company focuses on providing advanced sensing and laser technologies for various applications, including aircraft protection and both mounted and unmounted sensors.

The announcement is based on a press release statement and reflects the company’s current expectations for contract performance and product development. Leonardo DRS cautions that forward-looking statements related to contract values and product development are subject to risks and uncertainties that may cause actual results to differ from anticipated outcomes.

Investors and interested parties are reminded that such forward-looking statements involve risks and uncertainties that may impact the company’s future results and trends in ways that differ from those anticipated.

In other recent news, defense technology firm Leonardo DRS has been making significant strides in its operations and financial performance. The company secured a $49 million contract to manufacture additional Joint Assault Bridge systems for the U.S. Army and Romanian military, highlighting its expertise in advanced military engineering solutions. In addition, Leonardo DRS landed a $52 million order from the U.S. Army for advanced Sniper Weapon Sights, further bolstering its partnership with the military.

In terms of financial performance, Leonardo DRS reported a 20% year-over-year increase in organic revenue in the second quarter of 2024, with adjusted EBITDA and adjusted net earnings rising by 32% and 21% respectively. These strong results led to an upward revision of the company’s full-year guidance for revenue, adjusted EBITDA, and adjusted diluted EPS. In response to these developments, Baird raised its price target on Leonardo DRS shares to $30.00, maintaining an Outperform rating.

Despite facing efficiency issues in the IMS division and persistent supply chain challenges, Leonardo DRS remains optimistic about the defense budget. Recent developments also include the company’s facility expansion in Charleston, South Carolina, and its recognition with the Cogswell Award for industrial security commitment. These recent developments underline Leonardo DRS’s commitment to supporting the U.S. military’s operational capabilities and delivering advanced technology solutions.

InvestingPro Insights

Leonardo DRS’s recent $117 million contract with the U.S. Army highlights its position as a significant player in the defense technology sector. With a market capitalization of approximately $7.26 billion and a robust revenue growth of 15.81% in the last twelve months as of Q2 2024, the company’s financial health appears to be strong. This growth is further exemplified by an impressive quarterly revenue growth rate of 19.9% for Q2 2024, signaling a solid performance in the short term.

The company’s commitment to innovation and delivering advanced technology is also reflected in its investment value. With a price-to-earnings (P/E) ratio of 37.6, adjusted for the last twelve months as of Q2 2024, investors may find the company’s stock to be priced at a premium compared to the industry average, which can be justified by its growth prospects and technological advancements. Additionally, the company’s stock has shown considerable momentum with a year-to-date price total return of 40.27%, and a one-year price total return of 71.4%, as of 2024, indicating a strong bullish trend in investor sentiment.

InvestingPro Tips indicate that the company’s Price to Book ratio stands at 3.04, which suggests that the market values the company’s assets reasonably in relation to its share price. Furthermore, Leonardo DRS’s stock is trading at 92.86% of its 52-week high, showcasing investor confidence in the company’s market position and future prospects. For those interested in more in-depth analysis, InvestingPro offers additional tips on the company’s financial metrics and performance.

As of the latest update, InvestingPro has listed several more tips that provide valuable insights into Leonardo DRS’s financial health and investment potential. These additional tips are available through the InvestingPro platform and can guide investors in making informed decisions about the company’s stock.

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