After a slow start to the week Monday, the Department of Defense kicked its contracts-awarding machine into high gear Tuesday. In the space of 16 short contracts, the Pentagon doled out more than $8.3 billion in new contracts in a single day.
The vast majority of these funds went to a handful of energy companies providing renewable energy to the Army Corps of Engineers. Several other significant contracts were also awarded, including:
- $14.6 million for Boeing (NYSE:BA), recipient of a modification to a previously awarded contract to provide service and logistics support for Navy P-8A subhunter aircraft (which it built), along with supply of consumable parts, repair work, and engine removal and replacement. This contract runs through November 2013.
- $15.4 million for Britain's Ultra Electronics (NASDAQOTH: UEHPY) under an indefinite-delivery/indefinite-quantity (IDIQ), firm-fixed-price, performance-based contract to perform engineering and technical work in support of Air Defense Systems Integrator systems, communication systems, and satellite communication systems for the Navy. This contract includes options to extend its duration and increase its value which, if exercised, could keep Ultra at work through May 2016, and raise the contract value to $44.5 million.
- $25 million for Eaton's (NYSE:ETN) Aerospace division for the procurement of hydraulic parts for use on Boeing CH-47 Chinook helicopters.
- $22 million for L-3 Communications (NYSE:LLL) in the form of a modification to a previous contract to supply Hydromechanical Power Train 500-3ECB transmissions to the Army. The 500-3ECB powers the Army's Bradley Fighting Vehicle, and has historically been built by General Dynamics.
One non-publicly traded company -- General Atomics Aeronautical Systems -- received a sizable contract worth highlighting. GA was awarded $110.3 million Tuesday under a previously awarded cost-plus-incentive-fee contract to support Army Gray Eagle Unmanned Aircraft Systems (which it built) flying in Afghanistan. According to the Pentagon, the cumulative face value for GA on this drone contract now tops $354.6 million.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of General Dynamics and L-3 Communications Holdings. 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.
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