Goodrich Corp. (GR) received a $49 million supply contract from Northrop Grumman Corp. (NOC) to provide a number of composite components for eight Virginia Class nuclear fast attack submarines, collectively referred to as Block III.
 
Goodrich’s Engineered Polymer Products team in Jacksonville, Florida is building components to support the construction of one ship per year in 2009 and 2010, raising it to two ships per year from 2011 through 2013. The components include the bow dome, and sonar and weapons equipment.
 
The Virginia-class submarines are the first U.S. Navy combatant designed for the post-Cold War era. General Dynamics Corp. (GD) with its construction partner Northrop Grumman has contracts to build a total of 18 Virginia-class submarines.
 
Based in Charlotte, North Carolina, Goodrich supplies components, systems and services to the commercial and general aviation airplane markets. The company also supplies systems and products to the global defense and space markets. Businesses include manufacturing, service and sales, which are carried out in locations throughout the world. The company’s products and services are sold to customers in North America, Europe and Asia. Goodrich operates through three business segments – Actuation and Landing Systems, Nacelles and Interior Systems, and Electronic Systems.
 
Goodrich’s geographically diversified customer mix, strong balance sheet, incremental dividend, an ongoing share repurchase program and a relatively cheap earnings-based valuation support our bullish outlook for the company. However this is offset by the dwindling fortunes of the commercial aerospace market, dependence on international sales, high research and development overhead, and regulatory risks. Thus, we maintain our neutral recommendation on the shares.
Read the full analyst report on “GR”
Read the full analyst report on “NOC”
Read the full analyst report on “GD”
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