General Dynamics Information Technology, a business unit of General Dynamics Corporation (GD) was awarded a five-year contract by the Missile Defense Agency (MDA). The $565 million contract under MDA’s Engineering and Support Services (MiDAESS) program would provide infrastructure and deployment services in support of the Ballistic Missile Defense System.
Per the MiDAESS contract, General Dynamics will provide program management support and infrastructure logistics management and assist with facility standards, space and facility management to enhance the safety and quality of the Agency’s workplace environment.
The company will also provide operational fielding, sustainment and technical support for the MDA-developed systems as they are being prepared for operational use by the warfighter community. The company will assist MDA site surveys and selection, environmental compliance, interface with the operational users, and site activation and weapons systems sustainment from initial deployment through transition and transfer to the lead Military Service.
Based in Falls Church, Virginia, General Dynamics is one of the leading companies in business aviation, information systems and technologies, shipbuilding and marine systems, and land and amphibious combat systems, as well as armaments and munitions.
General Dynamics is slated to release its earnings for the first quarter of fiscal 2011 on April 27, 2011. The Zacks Consensus Estimate for the first quarter is $1.61, representing a year-over-year increase of 4.85%. The Zacks Consensus Estimate for fiscal 2011 is $7.13, up 4.60%. General Dynamics had a consistent track record with regard to surpassing earnings estimates in the last four quarters with a trailing four-quarter average of 3.15%.
The company ranks fourth among the U.S. defense contractors in terms of revenue in fiscal 2010, after The Boeing Company (BA), Lockheed Martin Corporation (LMT) and Northrop Grumman Corporation (NOC).
We view General Dynamics as a well-run company that is likely to continue delivering on expectations, driven by revenue growth, margin expansion and cash flow generation. However, an uncertain political landscape makes future defense budgets vulnerable to cutbacks. The falling order backlog is also a headwind for the company.
General Dynamics presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.
BOEING CO (BA): Free Stock Analysis Report
GENL DYNAMICS (GD): Free Stock Analysis Report
LOCKHEED MARTIN (LMT): Free Stock Analysis Report
NORTHROP GRUMMN (NOC): Free Stock Analysis Report
Zacks Investment Research
