General Dynamics Wins $323M Deal to Support Submarine Program

General Dynamics Corp.’s (GD) business unit, Electric Boat, recently clinched a modification contract involving submarines. The award has been offered by the Naval Sea Systems Command, Washington, D.C.Valued at $322.6 million, the contract is projected to be completed by September 2025. Per the terms of the deal, Electric Boat will provide engineering, technical, design agent and planning yard support for strategic and attack submarines. The majority of work related to this deal will be executed in Groton, CT. What’s Favoring GD Stock?Rising demand for naval modernization programs, backed by intensifying global geopolitical tensions, alongside aging submarine fleets, has been boosting the need for new submarine construction as well as steady maintenance, upgrades and lifecycle support services. Additionally, advancements in stealth, AI, and undersea warfare technologies are accelerating demand for specialized support systems to upgrade strategic and attack submarines.General Dynamics, a renowned submarine manufacturer and provider of yard support and associated solutions for these submarines, thus enjoys a steady stream of contracts for submarine manufacturing and associated services. The latest contract win is a bright example of that. Impressively, GD’s Electric Boat unit has been expanding its footprint through a series of real estate acquisitions it has made over the past six months to accelerate submarine production and related support services. The latest acquisition in this line was Electric Boat’s acquisition of the former Macy's department store location in Waterford, CT, in June 2025. The surge in submarine demand and lifecycle support services must have encouraged GD’s Electric Boat unit to strategically expand its infrastructure — including the recent Macy’s site acquisition — to enhance production capacity and efficiently execute critical contracts like yard support, ensuring it remains a dominant force in naval modernization. GD’s Growth ProspectsIncreasing demand for advanced submarine technologies like stealth capabilities, underwater surveillance and long-range strike systems, as well as the growing complexity of modern naval warfare, has been boosting the growth opportunities of the submarine market.This is likely to have prompted the Mordor Intelligence firm to forecast a compound annual growth rate of 4.2% for the global submarine market during 2025-2030.This is likely to benefit General Dynamics, with its Electric Boat business division, which is responsible for all aspects of design and engineering of Columbia-class ballistic missiles and Virginia-class attack submarines.Opportunities for Other Defense StocksOther defense companies that are likely to enjoy the perks of the expanding global submarine market have been discussed below.Huntington Ingalls Industries (HII): Its Newport News Shipbuilding unit is one of two designers and builders of nuclear-powered submarines for the U.S. Navy. Through its Newport News Shipbuilding division, HII is involved in producing the Columbia-class and Virginia-class submarines, two key assets of the U.S. Navy. The company provides fleet services to its submarines around the world, offering modernization, repair and installation services.BAE Systems (BAESY): It plays a vital role in the production of advanced submarines, particularly in the United Kingdom’s defense sector. BAE Systems is the primary manufacturer of the Astute-class nuclear submarines, which are integral to the Royal Navy's fleet.The company is also working as part of the Dreadnought Alliance, alongside partners Rolls-Royce and the Submarine Delivery Agency, to deliver the Dreadnought-class submarine program.Northrop Grumman Corporation (NOC): It is a renowned provider of missile launch systems for naval submarines. The company manufactures Launcher Subsystem hardware to support the Columbia and Dreadnought common missile compartment program.Its systems and sensors are fielded on Virginia-class submarines. See our %%CTA_TEXT%% report – free today!7 Best Stocks for the Next 30 DaysWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Northrop Grumman Corporation (NOC): Free Stock Analysis Report General Dynamics Corporation (GD): Free Stock Analysis Report Bae Systems PLC (BAESY): Free Stock Analysis Report Huntington Ingalls Industries, Inc. (HII): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks