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Raytheon Wins Industrial Award for Air Traffic System Upgrade

Zacks

Aerospace and defense operator Raytheon Company RTN has been given the 2016 Industrial Award by The Air Traffic Control Association for modernizing key air traffic systems, in order to control the most complex and jam-packed airspaces across the nation.

Raytheon’s Role in Modernization

Notably, Raytheon had supported the transformation of the Federal Aviation Administration’s (FAA) 11 largest Terminal Radar Approach Control (TRACON) facilities, which are responsible for the management of up to 80% of the U.S. air traffic.

The company had worked with the National Air Traffic Controllers Association, the Professional Airways Systems and the FAA to install its state-of-the-art Standard Terminal Automation Replacement System (STARS) over a period of 18 months at various TRACON facilities.


RAYTHEON CO Price

What is STARS?

The Standard Terminal Automation Replacement System (STARS) is a high-tech air traffic control system for managing terminal area airspace. It ensures safety as well as cost reduction by eliminating the need to develop, test and deploy software on multiple systems.

Raytheon has a goal of installing the STARS at every FAA facility by 2019.

A Recent Milestone

On Oct 12, Raytheon introduced the Global Positioning System Next-Generation Operational Control System, known as GPS OCX, for the U.S. Air Force. This system offers significant improvements, accuracy and availability to the GPS system, which is now used as extensively by the military as the public.

Our View

We believe that high-quality air traffic management systems not only facilitate safety and rapid air transportation but also increase aviation fuel efficiency for the airline operators.

Raytheon’s consistent focus on research and development activities allows the company to churn out new and upgraded products. Raytheon invested $380 million in the first half of 2016 in research & development activities, which was 15.8% higher from the prior-year period.

Zacks Rank & Key Picks

Raytheon Company currently has a Zacks Rank #4 (Sell). Some better-ranked stocks in the aerospace sector include AAR Corp. AIR, CAE Inc. CAE, and Esterline Technologies Corp. ESL.

AAR Corp., a Zacks Rank #1 (Strong Buy) stock, has witnessed an increase of 4.9% and 3.4% in the Zacks Consensus Estimate for earnings for 2016 and 2017, respectively, over the last 60 days.

CAE has delivered an average positive earnings surprise of 10.60% in the trailing four quarters. The company sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Esterline is a Zacks Rank #2 (Buy) stock. It has witnessed an increase of 0.7% and 0.9% in the Zacks Consensus Estimate for earnings for 2016 and 2017, respectively, over the last 60 days.

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