The Zacks Analyst Blog Highlights:Northrop Grumman, Raytheon, L-3
Communications Holdings, Lockheed Martin and Ford Motor
CHICAGO, Dec. 27, 2012
CHICAGO, Dec. 27, 2012 /PRNewswire/ --Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include Northrop Grumman Corporation
(NYSE:NOC), Raytheon Company (NYSE:RTN), L-3 Communications Holdings Inc.
(NYSE:LLL), Lockheed Martin Corporation (NYSE:LMT) and Ford Motor Co.
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Here are highlights from Wednesday's Analyst Blog:
Northrop's Drones to Fetch $1.2B
The U.S. Department of Defense ("DoD") has made a proposal to Congress for the
sale of Northrop Grumman Corporation's (NYSE:NOC) Global Hawk surveillance
drones to the government of South Korea under the foreign military sale
("FMS") program. The deal is expected to be $1.2 billion.
If the request is approved by the Congress, then Northrop will sell four RQ-4
Block 30 (I) Global Hawk spy drones. Per the deal, Northrop would also supply
associated equipment, parts, training and logistical support, which would
include infrared and electro-optical sensors, imagery analysis systems and
moving target indicators on board the Global Hawk Block-30 unmanned aircraft.
These drones have been used by the U.S. Air Force in Afghanistan and Iraq. The
deal would be the first order in the Asia- Pacific region for the
high-altitude surveillance drones. Despite being interested in buying the
aircraft, Australia has not yet placed an order for the same.
In the defense budget proposal for 2013, DoD had proposed to cancel the
Block-30 version of the Global Hawk drone. Instead, it was looking for the
purchase of more advanced Block-40 model. However, Congress opposed to the
proposal and declared in the defense authorization bill that Air Force is not
allowed to retire the Block-30 drones at least until the end of 2014.
Apart from Northrop's proposal, DoD had also requested for the sale of
Raytheon Company's (NYSE:RTN) 117 AIM-9X Sidewinder missiles worth $140
million to Turkey, a foreign military sale of satellite ground stations worth
$125 million by L-3 Communications Holdings Inc. (NYSE:LLL) to Iraq, and a
$406 million sale of artillery rockets by Lockheed Martin Corporation
(NYSE:LMT) to Qatar.
All these requests are just a notification for potential purchases. They will
be firm orders only when approved by the Congress and the countries sign
contracts with the DoD.
Based in Falls Church, Virginia, Northrop Grumman Corporation supplies a broad
array of products and services to the U.S. DoD, including electronic systems,
information technology, aircraft, space technology, and systems integration
Northrop has a strong presence in Air Force, Space & Cyber Security programs.
Northrop's product line is well positioned in high priority categories, such
as defense electronics, unmanned aircraft and missile defense.
Revenue and earnings growth continue to be driven by its strong presence in
the current focus areas of cyber security, modernization of defense and
homeland security assets, intelligence, surveillance and reconnaissance
systems, advanced electronics and software development. Moreover, this
contract would enhance the company's position.
However, these positives are offset by apprehension regarding defense cutbacks
on high-cost platform programs, over-exposure to the DoD budget, lower
backlog, cost over-runs and reductions in the Afghanistan and Iraq operations.
The company presently retains a short-term Zacks #3 Rank (Hold) that
corresponds with our long-term Neutral recommendation on the stock.
Ford Fusion Earns Top Safety Rating
Ford Motor Co. (NYSE:F) announced that its 2013 Ford Fusion received an
Acceptable Rating in the small overlap front crash test and earned the highest
crash safety rating, Top Safety Pick+, from Insurance Institute for Highway
Safety (IIHS). The model, which was earlier rated as a Top Safety Pick, will
now be considered under the plus rating for the same manufactured after
IIHS provides ratings of good, acceptable, marginal or poor based on
performance of the car in the moderate overlap frontal crash, small overlap
frontal crash, side impact and rollover. It also evaluates seat/head
restraints in vehicles for protection against neck injuries. To earn the plus
rating, the vehicles are required to achieve good ratings for occupant
protection in at least 4 out of 5 IIHS evaluation.
Ford aims to design and produce vehicles with highest standards of safety. The
new Fusion with the highest safety distinction from IIHS will assist the
company in achieving its goal.
The 2013 Ford Fusion features Personal Safety System, new safety belt
technologies and eight airbags to protect passengers. The vehicle is equipped
with redesigned seat-mounted side airbags placed in the lower pelvis area and
incorporates new venting technology, which further improves side protection.
It is also a fuel-efficient vehicle with numerous technologies, which enhances
driving experience, reduces stress and helps avoiding injurious incidents.
Michigan-based Ford is one of the largest automobile producers in the world.
The company operates in two segments: Automotive and Financial services.
Although the company's primary selling ground is the U.S.; Europe, South
America and the Asia-Pacific constitute its other major markets.
Ford posted a 17.6% rise in earnings per share to 40 cents in the third
quarter of the year from 34 cents a year ago, driven by impressive results in
its North American operation and, to some extent, its Asian operation. With
this, the company has also surpassed the Zacks Consensus Estimate by 10 cents
per share. Total profit rose 15.6% to $1.6 billion from $1.4 billion a year
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