Alliant Techsystems Inc. (ATK), Northrop Grumman Corporation (NOC): Defense Contractors Indispensable to the U.S. Military

The AARGM missile system can be integrated onboard the Lockheed Martin Corporation (NYSE:LMT) F-35 Lightning II aircraft. Currently the missile is in use on the Boeing FA-18C/D Hornet, FA-18E/F Super Hornet and the EA-18G Growler aircraft.

Weapon detection system

On the defensive side of the equation Northrop Grumman Corporation (NYSE:NOC) received a $15.7 million modification contract from Army Contracting Command for the Vehicle and Dismount Exploitation Radar System (VADER). This advanced radar system can detect vehicles and humans with high resolution images and real time ground moving targets.

The main advantage of VADER is in detecting improvised explosive devices (IEDs) or landmines that target U.S. troops and ground vehicles. The deployment of this device should decrease mortality rates for U.S. personnel in hotspots around the world. The total value of this contract is worth $141 million according to Army officials.

Northrop Grumman Corporation (NYSE:NOC) predicts sales of $24 billion for FY2013, this should be an attainable goal considering all contracts are honored and not cancelled by the U.S. military industrial complex. If sales continue as expected an EPS of $6.85 – $7.15 is forseeable.

Long-term investment opportunity

Firearms and combat aircrafts require an infinite supply of armaments this is an established fact indicated by military investments. The companies summarized here cover offensive and defensive sides of the military establishment.  Ongoing worldwide escalations and the need for national security directly translates into the need for companies like Alliance, Lockheed Martin and Northrop Grumman Corporation (NYSE:NOC) that mutually benefit each other.

The article Defense Contractors Indispensable to the U.S. Military originally appeared on Fool.com.

Robert Palmer has no position in any stocks mentioned. The Motley Fool owns shares of Lockheed Martin and Northrop Grumman. Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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