Boeing rises after landing $20 billion U.S. Navy fighter jet contract
BA•Boeing was selected to build the U.S. Navy’s next-generation stealth fighter under a $20 billion development contract to produce test aircraft. Its shares rose nearly 3% in premarket trading.
1. Boeing wins contract
The Pentagon said Tuesday that Boeing was selected to build the U.S. Navy’s next-generation stealth fighter, beating Northrop Grumman for a $20 billion development contract to produce test aircraft. Boeing shares rose nearly 3% to $193.22 in premarket trading, while Northrop shares fell about 3%.
2. Investor focus remains
JPMorgan maintained its overweight rating on Boeing and called the win important, while saying longer-term investor focus should remain on increasing commercial aircraft production and cash flow per plane. A brokerage said it knew little about the development contract but assumed Boeing had not taken on undue risk, citing management’s previously stated commitment to discipline in pursuing new business.
