Boeing Stock Jumps, Lockheed Falls on Air Force Jet Fighter Contract News

Key Takeaways

• Shares of Boeing surged Friday to lead Dow Jones Industrial Average gainers after President Donald Trump named the plane maker the winner of a contract to build the U.S. Air Force's next-generation fighter jet, the F-47.
• Shares of Lockheed Martin sank nearly 6% Friday after the defense contractor lost out to its rival.
• Financial terms were not disclosed, but The Wall Street Journal reported that "experts say the total research, development and acquisition costs could top $50 billion."

Shares of Boeing (BA) jumped Friday, leading Dow Jones Industrial Average gainers, after President Donald Trump named the plane maker the winner of a contract to build the Air Force's next-generation F-47 fighter jet.

"After a rigorous and thorough competition between some of America's top aerospace companies, the Air Force is going to be awarding the contract for the next-generation air dominance platform to Boeing," Trump said, according to a video provided by The Wall Street Journal.

The Air Force later confirmed that it indeed was awarding the Next Generation Air Dominance Platform contract to Boeing. Financial terms were not disclosed, but the Journal reported that "experts say the total research, development and acquisition costs could top $50 billion."

"We recognize the importance of designing, building and delivering a 6th-generation fighter capability for the United States Air Force," Boeing Defense, Space & Security CEO Steve Parker said. "In preparation for this mission, we made the most significant investment in the history of our defense business."

Boing stock was recently up nearly 4%. Shares of Lockheed Martin (LMT) sank more than 5% after the defense contractor lost out to its rival. Lockheed has supplied the Air Force with F-22 Raptor and F-35 fighter jets. The F-47 would replace the F-22, the Journal said.

"While disappointed with this outcome, we are confident we delivered a competitive solution," a Lockheed spokesperson said in a statement to Investopedia. "We will await further discussions with the U.S. Air Force."

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