Lockheed Martin (LMT) showcased its F-35 Lightning II mobile cockpit demonstrator today to state and local elected officials, local suppliers and employees at Northrop Grumman (NOC), a partner on the F-35 program. This is a first look at what is being touted as the worlds' most advanced multirole fighter aircraft.
Lazard Capital Markets' Michael Lewis issues a warning shot over defense industry stocks, as he notes that the strategy of firms such as Northrop Grumman (NOC) and Booz Allen Hamilton (BZH) of growing profits by cutting costs could catch up to them this year. "All the low-hanging fruit has already been picked. There’s not much fat in the infrastructure."
President Obama unveils his administration's defense strategy (.pdf), which will lead to more than $450B in cuts over the next 10 years. In addition to mentioning Iran and terrorism, the review highlights the intention to counter any threats from China given that it has the potential to affect the U.S.'s economy and security.
Though news of the latest iPhone or Facebook remodel dominated headlines in 2011, many other firms flexed their own creative muscles. WSJ spotlights some of the year's most impressive inventions: IBM's Watson computer, Northrop's (NOC) X-47B drone, Edwards Lifesciences' (EW) Sapien transcatheter heart valve, Intel's (INTC) tri-gate transistors, and more.
CPI Aerostructures (CVU +16.2%) jumps after its Q3 beats estimates across the board. Revenues increased 28% Y/Y, primarily due to contract work done for Boeing (BA -0.5%) on the A-10 attack jet and on the E-2D surveillance airplane for Northrop Grumman (NOC -1%). The company raises its FY12 revenue guidance, now expecting revenues of $95M to $98M, above the Street estimate of $95M.
More on Northrop Grumman's (NOC) Q3 report: Segment revenue: Aerospace $2.58B -5% Y/Y; Electronic Systems 1.91B +2%; Information Systems -8%; Technical Services -22%. Steers EPS guidance up to a range of $6.95-$7.05 on higher expected segment operating margin rate and total operating margin rate, and lower weighted average shares outstanding. Shares +0.2% premarket. (PR)
Star Wars defense redux? The Navy's ex-Chief of Naval Operations says the U.S. needs more long-range strike capability to support aircraft carrier groups increasingly stretched across the globe and facing large coastal defensive obstacles: "The U.S. has not had to deal with something like this since the Cold War." Contractors eager to bid: RTN, NOC, BA, GD.
Lockheed Martin (LMT +0.9%) competes with Northrop Grumman (NOC +0.4%) for a $1.7B contract from the U.S. Navy to develop a communications network (Canes) to link 190 ships, subs and operation centers over the next ten years. With the Navy's systems and equipment showing its age, the program is expected to survive defense budget cuts.
Wondering how Obama's pullback from the Bush missile shield will impact defense stocks BACAILMTGDNOCRTN and etfs ITAPPA.
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Northrop Grumman Corporation is a security company providing innovative systems, products and solutions in unmanned systems, cybersecurity; command, control, communications and computers (C4) intelligence, surveillance, and reconnaissance.