The Zacks Analyst Blog Highlights: Boeing, Leidos, Virgin Galactic, Northrop Grumman and Lockheed Martin

Zacks Equity Research
·7-min read

For Immediate Release

Chicago, IL – June 2, 2020 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: The Boeing Company BA, Leidos Holdings Inc. LDOS, Virgin Galactic Holdings, Inc. SPCE, Northrop Grumman Corp. NOC and Lockheed Martin Corp. LMT.

Here are highlights from Monday’s Analyst Blog:

4 Tech Stocks to Soar on SpaceX's Historic Voyage

Since NASA retired the Space Shuttle in 2011, astronauts and supplies to the International Space Station (ISS) are being sent through Russian vessels. However, on May 30, SpaceX launched the Dragon capsule on top of a Falcon 9 rocket, boarded by NASA astronauts Doug Hurley and Bob Behnken. They are the first astronauts to be launched into space in nearly a decade from American soil.

The Dragon capsule or spacecraft that is capable of ferrying up to seven astronauts is called the Crew Dragon, while the Cargo Dragon ferries cargo to outer space. The Crew Dragon capsule, now known as Endeavour, has successfully docked with the ISS. SpaceX now holds the record of being the first private company to send man into outer space, which was earlier done only by the governments of the United States, Russia and China.

An Era of Commercial Space Travel

The recent success not only marks the restart of America’s venture into the space through its own soil but also opens up an arena for private companies dealing with space technology. In fact, private companies like SpaceX have shown that launching satellites to outer space can be cheaper than expected. SpaceX's partially-reusable Falcon9 rocket and Crew Dragon capsule combination is more than competitive in price even though the company is the latest to enter the market.

NASA has provided massive funding to The Boeing Company and SpaceX to develop and operate a new generation of spacecraft and launch systems capable of carrying crew to low-Earth orbit and the ISS. NASA has also announced another partnership with SpaceX, Blue Origin and Leidos Holdings Inc.’s subsidiary Dynetics to work on the landing systems for its Artemis program. NASA aims to land the first woman and next man on the moon by 2024.

The SpaceX launch was a giant success in the growing space tourism sector, which includes players like Virgin Galactic Holdings, Inc. and Amazon founder Jeff Bezos' Blue Origin.

In fact, space exploration and tourism along with long-haul travel on the Earth are expected to grow into a more than $800 billion industry in the coming decade.The global space launch services market size was valued at $9.88 billion in 2019 and is expected to reach $32.41 billion by 2027, at a CAGR of 15.7%.

Trump’s Space Force Program

For a decade now, America has been relying on Russia for sending its astronauts and supplies to the ISS at a hefty cost of $86 million per seat. During U.S. President Donald Trump’s first year in office, he signed a directive for NASA to work with private sector partners to send man on moon again, followed by Mars and outer space.

Last December 2019, Trump launched the United States Space Force (“USSF”), which is the space warfare service branch of the U.S. Armed Forces. The program is responsible for organizing, training and equipping forces for space service support. This includes missile warning and provides freedom of operation for the United States in, from, and to space.

Per a Reuters report on May 6, the U.S. administration is drafting a legal blueprint for mining on the moon. This new U.S.-sponsored international agreement is called the Artemis Accords, which is a named after the NASA’s new Artemis moon program. The accord supports NASA’s plan to put humans and space stations on the moon within the next decade. However, the draft plan for the accordhasstill not been formally shared with America’s allies and has neither been signed.

4 Stocks to Watch Out For

The success of SpaceX and plans of launch of new constellations of satellites to enter low-Earth orbit in the coming years brighten prospects for space technology. Hence, we have shortlisted four stocks that belong to the Zacks Aerospace - Defense industry and can make the most of this boom. All the stocks carry Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

The Boeing Company designs reusable space vehicle technologiesin collaboration with NASA. The company is working on the Boeing CST-100 Starliner (Crew Space Transportation-100), which is a reusable crew capsule. Its primary purpose is to transport crew to the ISS and to private space stations, such as the proposed Bigelow Aerospace Commercial Space Station.

The company has an expected earnings growth rate of 45.4% for the current year.

Northrop Grumman Corp. offers mission systems and solutions that are applicable to aerospace along withend-to-end space and launch systems. The company has an expected earnings growth rate of 4.3% for the current year.

Lockheed Martin Corp. provides the U.S. government, the Department of Defense and NASA with satellites, rocket launch systems, ground systems and plays an immense role in the Space Force program. The company has an expected earnings growth rate of 9.6% for the current year.

Leidos Holdings, Inc. has processed, packaged and shipped ISS cargo for 87 visiting vehicles that include SpaceX and Orbital ATK. Leidos offers services for commercial low-Earth orbit and lunar spaceflight which includes payload design, mission integration, and human factors engineering. The company has an expected earnings growth rate of 1.4% for the current year.

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Click to get this free report Northrop Grumman Corporation (NOC) : Free Stock Analysis Report The Boeing Company (BA) : Free Stock Analysis Report Lockheed Martin Corporation (LMT) : Free Stock Analysis Report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report Virgin Galactic Holdings, Inc. (SPCE) : Free Stock Analysis Report To read this article on click here. Zacks Investment Research