investingfromtheright

I am retired and take educated guesses on all things financial.

October 15, 2006

October 16, 2006: DEFENSE and TECH

There are some very interesting developments in the aero-defense industry.

SAI Company came public at approximately $15.00 a share. I addressed this IPO last week to give my blog readers a heads up. I even beat Cramer on this one! Buy it. It is a great company primed to do substantial- MORE than substantial - DOD and NSC work in the foreseeable future with engineering and multiple-type research contracts. Trading at $18.18. www. saic.com

Boeing, a strong recommendation on this blog, announced/will announce 175 aircraft orders for September and 100 aircraft deliveries for the third quarter. Singapore airlines ordered 10 747-8F freighters with options for 10 more. AIRBUS SUCKS, BOEING WINS BIG.

Goodrich (GR), another strong recommendation was awarded the contract for E-3 AWACS aircraft seating configuations worth approximately 97 million dollars with much more to come.

L-3 Communications (LLL) looks to lock in two huge contracts, the Army Linguist contract and the C-27 JCA surveillance contract. The ultimate totals of these two projects alone rate several billions of dollars, at a miunimum, in my opinion.

WARNING: With the armed forces being requested to maintain groud deployment levels through 2010, personnel costs are said to be strongly increasing and may put a bid crimp in R&d programs throughout the entire military for fiscal years 2008-2013. I will keep an eye on this. The service most impacted at first will be the Air Force strategic wings and acquisition departments.Homeland Security will not be impacted primarily because of political considerations.

Anti-missile stocks to counter the little piglet in North Korea:

General Dynamics (GD)77.00 a share. Modest upside potential
Lockheed Martin (LMT) 88.00 a share. Good upside potential.
L-3 Communnications (LLL) 78.00 a share. Buy it!
Raytheon (RTN) 49.00 a share. Good upside potential.
Precision Castparts (PCP) 67.00 a share. Very good upside potential.
BE Aerospace (BEAV) 23.75 a share. Buy it!

These are larger companies that have downside protection with other solid operations, in my opinion.

If you want some smaller companies more highly concentrated in a pure anti-missile component, e-mail me and I will try to answer your inquiries.

TECH: This is earnings week for tech and I believe that the earnings will be very good for many companies. If you need exposure and do not want to risk it on individual stocks, two ETF's I like are PTF (A Powershares aggressive tech ETF centered in smaller US companies) and SGI (iShares Global Tech with holdings in larger companies worldwide).I do not own either, but may have one or both in my portfolio Monday as I lighten up on my position in MTF (Mitisubishi Financial). This stock has not been performing as well as expected and I will take a small long term profit here and wait for the Japanese financials to right themselves.

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