At first glance, the $6.8 million contract that Boeing (NYSE:BA) just won from America's Missile Defense Agency probably sounds more like a rounding error than an actual, material event in the life of this $75 billion company. But it could become material in time.
On Wednesday, the Pentagon announced it was quadrupling the size of Boeing's original $2.2 million contract to do "instruments and payloads" work on an unnamed "experimental prototype aircraft." The Pentagon's contract also specifies that Boeing will "gather, analyze, and report flight test data to characterize potential payload environments" over the next five months.
All of this is very early-stage work, though, on a plane that Boeing hopes will one day vault it into contention with larger players such as General Atomics and Northrop Grumman (NYSE:NOC) in the unmanned aerial vehicle space. This is because the "experimental prototype aircraft" in question is the Boeing Phantom Eye, a planned high-altitude, long-endurance -- or HALE -- aircraft that could compete with Northrop's RQ-4 Global Hawk for government contracts in the future.
Boeing describes Phantom Eye as an unmanned, propeller-driven HALE powered by hydrogen-powered internal combustion engines. Once up and running, Boeing hopes the Phantom Eye will be able to fly for up to four days straight without refueling, at altitudes of up to 65,000 feet and speeds approaching 200 knots.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Northrop Grumman. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.