Huntington Ingalls Surges 5.7% on Navy Contract and AI-Driven Innovation—What’s Fueling This Record High?

Summary
• Huntington Ingalls (HII) hits a 52-week high of $357.105, surging 5.7% intraday on Dec. 22, 2025.
• U.S. Navy selects Ingalls Shipbuilding for a new small surface combatant design, boosting investor confidence.
• ROMULUS AI-powered unmanned vessel reaches 30% completion, signaling a leap in autonomous naval tech.

Huntington Ingalls (HII) is trading at a record high of $355.9, up 5.7% from its open at $339.0. The surge follows a major Navy contract win and progress on its AI-driven ROMULUS unmanned surface vessel. With a 52-week range of $158.88–$357.105 and a dynamic P/E of 23.49, the stock’s momentum reflects strong demand for defense innovation and long-term workload visibility.

Navy Contract and AI Breakthrough Drive HII’s Record High
Huntington Ingalls’ record intraday surge stems from two pivotal developments. First, the U.S. Navy awarded Ingalls Shipbuilding a contract to design and build a new small surface combatant based on the Legend-class cutter design. This program solidifies HII’s long-term naval shipbuilding portfolio and provides steady workload visibility. Second, the company’s ROMULUS AI-powered unmanned surface vessel (USV) reached 30% completion, with sea trials slated for Q4 2026. The ROMULUS platform, integrating advanced autonomy and AI, aligns with the Pentagon’s $8 billion push for autonomous systems, positioning HII as a leader in next-gen naval defense.

Defense Sector Rally as HII Outpaces Peers
The Aerospace & Defense sector is showing strength, with HII’s 5.7% gain outpacing General Dynamics (GD), which rose 1.78% on the same day. GD’s muted performance contrasts with HII’s momentum, driven by its exclusive role in U.S. naval shipbuilding and AI-driven innovation. While GD’s earnings estimate remains flat, HII’s EPS revisions and contract wins suggest stronger near-term upside. The sector’s broader rally reflects heightened demand for defense modernization, particularly in unmanned systems and AI integration.

Options Playbook: Leverage HII’s Bullish Momentum with High-Gamma Calls
• MACD: 5.996 (above signal line 4.903), RSI: 71.36 (overbought), 200D MA: 258.73 (far below price).
• Bollinger Bands: Price at upper band (335.29), indicating strong short-term bullish pressure.
• Support/Resistance: 309.49–310.18 (30D support), 269.17–272.24 (200D support).

Huntington Ingalls is trading above its 200-day average and key resistance levels, with RSI in overbought territory. The stock’s 5.7% intraday gain suggests continued momentum, supported by its AI-driven ROMULUS project and Navy contract. For options traders, high-gamma call options offer leverage to capitalize on this move.

Top Option 1: HII20260116C380
• Type: Call, Strike: $380, Exp: 2026-01-16, IV: 32.10%, Leverage: 81.81%, Delta: 0.246, Theta: -0.267, Gamma: 0.010385, Turnover: 51,379.
• IV (Implied Volatility): High, reflecting strong market expectations.
• Leverage: Extreme, ideal for aggressive bullish bets.
• Gamma: Sensitive to price swings, amplifying gains if HII continues upward.
• Turnover: High liquidity ensures easy entry/exit.
• Payoff at 5% Upside: $373.70 → $373.70 - $380 = $0 (breakeven).
• Why It Stands Out: High leverage and gamma make this call ideal for a sharp move, though breakeven requires a 1.3% rally from current levels.

Top Option 2: HII20260116C360
• Type: Call, Strike: $360, Exp: 2026-01-16, IV: 32.27%, Leverage: 32.43%, Delta: 0.482, Theta: -0.387, Gamma: 0.012961, Turnover: 397,844.
• IV: High, aligning with sector volatility.
• Leverage: Moderate, balancing risk and reward.
• Delta: Mid-range, offering balanced exposure to price movement.
• Gamma: Strong, enhancing returns as HII rises.
• Turnover: Exceptional liquidity for large positions.
• Payoff at 5% Upside: $373.70 → $373.70 - $360 = $13.70 per share.
• Why It Stands Out: This call offers a safer entry point with strong gamma and liquidity, ideal for a measured continuation of HII’s rally.

Action Insight: Aggressive bulls may consider HII20260116C380 for high-leverage exposure, while HII20260116C360 provides a balanced play on HII’s AI-driven momentum. Both contracts benefit from HII’s proximity to key resistance and the sector’s focus on autonomous systems.

Backtest Huntington Ingalls Stock Performance
The backtest of HII's performance following a 6% intraday increase from 2022 to now shows a strategy return of 34.03%, with a benchmark return of 42.97% and an excess return of -8.94%. The strategy has a CAGR of 7.75% and a maximum drawdown of 0.00%, indicating a volatile but potentially profitable performance.

HII’s Bull Run Gains Steam—Position for a Breakout in 2026
Huntington Ingalls’ record high is fueled by a perfect storm of contract wins, AI innovation, and sector tailwinds. With ROMULUS nearing 30% completion and the Navy’s $1.5 billion AI push, HII is positioned to outperform peers like General Dynamics (GD), which rose 1.78% today. Technicals suggest a continuation of the bullish trend, with RSI near overbought levels and MACD above the signal line. Investors should monitor the $357.105 52-week high as a critical resistance; a break above this could trigger a retest of the $380 level. For options traders, the HII20260116C360 call offers a balanced entry to capitalize on HII’s AI-driven momentum. As the defense sector pivots toward autonomy, HII’s dual focus on traditional shipbuilding and cutting-edge tech makes it a must-watch in 2026.