Northrop Poised To Benefit As Drone Market Soars
BY GILLIAN RICH, INVESTOR’S BUSINESS DAILY
Northrop Grumman (NYSE:NOC) and General Atomics are expected to benefit from the military drone market expanding to $10.4 billion by 2024 from $6.4 billion now.
That represents growth of 5.5% each year for the next 10 years, according to the research group IHS, which said combat drones have the potential to replace manned aircraft in many roles.
“Unmanned systems are here to stay,” said Derrick Maple, principal analyst for unmanned systems at IHS Jane’s, according to a statement. “These systems are well established, combat proven and are an essential and expanding element of future operations across the globe.”
Israel was the top exporter last year, but IHS said the U.S. will regain the top spot this year — with 57% of total unmanned aerial vehicle (UAV) sales — thanks to sales of General Atomics’ Predator and Northrop Grumman’s Global Hawk drones.
Northrop shares were up 2% to 170.77 in the stock market today. Northrop is also competing against Lockheed Martin (NYSE:LMT), Boeing (NYSE:BA) and General Atomics to develop UAVs for the Navy that can take off and land from aircraft carriers.
Another U.S.-based drone maker is AeroVironment (NASDAQ:AVAV). While AeroVironment has a major presence in the military UAV space, it also has been selling drones for law enforcement and commercial industries.
AeroVironment shares jumped 2.4% to 21.17.
European countries will account for 60% of UAV imports in the 2014-2015 time frame, according to IHS. Meanwhile, South Korea, India, Japan and Australia are increasing their UAV imports and will account for over 35% of total imports over the next five years.
But the U.S. and Israeli industries won’t have the export market all to themselves. Turkey, Sweden and South Africa are expected to increase exports as well.
Read More At Investor’s Business Daily: http://news.investors.com/business/100515-774100-northrop-poised-to-benefit-as-drone-market-doubles.htm#ixzz3nmjzGaUE
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