American Science and Engineering Takes Off on $67Million Defense Contract

I noticed American Science & Engineering (ASEI) took off Thursday on 3x normal volume - doing some digging (this was not out as a press release via ASEI) we find a hefty order from the Defense Department.

• American Science and Engineering, Inc., Billerica, Mass., is being awarded a $67,391,360 firm fixed priced contract for the manufacturing and production of 66 AS&E Z-Backscatter (ZBV) Military Trailers. Work will be performed within the Continental United States, and work is expected to be completed by the end of January 2010. Contract fund will not expire at the end of the current fiscal year. This contract was sole sourced procured. The Marine Corps Systems Command, Quantico, Va., is the contracting activity

I don't have access to analyst reports so I do not know if this contract was in anyone's estimates. I would guess "no" considering how the stock reacted.

ASEI has a non -ypical year end of March 31st, so their 2010 year ends March 2010. Since this deal will be done by January 2010, and their 2009 year ends March 31, 2009 - the great bulk (if not all) of this deal would fall in their fiscal 2009. Currently analysts have about $250M in revenue estimated so this is a deal that adds 20%+ to their 2010 fiscal year (April 2009 to March 2010)

Technically the stock has been in a range for a month, but yesterday's move pushed it over recent highs of $77. I'd definitely like to add this name to the arsenal if we can get a pullback. But if this contract is not in analysts' estimates, a very justified premium over yesterday's price could take this name higher first....

[Dec 30: American Science & Engineering - Very Promising]

Disclosure: No position