On Thursday, the Department of Defense announced that it has awarded defense contractor Raytheon (NYSE:RTN) a $33.3 million cost-only contract to procure "long-lead material" needed to manufacture Standard Missile-6 (SM-6) Block I missiles for the Navy.
The SM-6, the most modern variant of Raytheon's Standard missile family, is a surface-to-air defense missile, usually based on a destroyer or cruiser, and used to shoot down enemy aircraft and anti-ship cruise missiles. It is also designed to shoot down ballistic missiles in their terminal phase, and thus useful for anti-ballistic missile defense.
The first version of the SM-6 -- the Block I described in the contract -- is due to enter service in 2015. Accordingly, work on this contract is scheduled to be complete by February 2015. A subsequent Block II version of the SM-6 is expected to appear around 2018.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Raytheon Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.