LMT has been an awesome divy stock for some time. Note the selloff from the lower than expected share repurchase funded by sale of their IT unit. Volume is well above ave so worth watching as it may signal some short term damage. Fairly expensive currently. Yield good at 2.5%. I got out a few weeks ago given the valuation and have on buy list though would like to see it test $245 first
Lockheed Martin Signs Letter of Intent With Polska Grupa Zbrojeniowa
Sep 07, 2016 10:00:00 (ET) KIELCE, Poland, Sept. 7, 2016 /PRNewswire/ -- Global aerospace and security company Lockheed Martin (NYSE: LMT) has signed a wide ranging Letter of Intent (LoI) with Poland's state owned defence company Polska Grupa Zbrojeniowa (PGZ) which could lead to Poland's involvement in some of the world's most innovative defence and security programmes.
The agreement was signed today at the International Defence Industry Exhibition (MSPO) in Kielce by Jonathan Hoyle, Lockheed Martin Vice President Europe and Latin America and Arkadiusz Siwko, President, PGZ. It paves the way for PGZ member companies to be directly involved in the manufacture of satellite systems, aircraft, helicopters, weapons and combat systems, training devices and simulators. Both Polish domestic and export customers are set to benefit from the agreement.
The LoI builds on an agreement inked by PZL Mielec, a Lockheed Martin company, and PGZ at the Farnborough International Air Show, in late July. It includes involvement in the Medium Extended Air Defense System (MEADS), which is NATO's air and missile defence system of choice.
In addition, there is a commitment to the evaluation of a regional BLACK HAWK helicopter upgrade, maintenance, repair and overhaul facility in Poland and greater involvement of PGZ member companies in the supply of weapons, components and assemblies for products manufactured in Mielec.
"This is a very significant step towards tightening the cooperation between Polska Grupa Zbrojeniowa and Lockheed Martin which is a very important partner for us. We hope this cooperation will result in strengthening our long-term partnership and our involvement in many successful projects, to the benefit of both American and Polish industry, " said Arkadiusz Siwko, President, Polska Grupa Zbrojeniowa.
"Lockheed Martin has customers in more than 70 countries worldwide and is pursuing a strategy of international business growth which presents significant opportunities for PGZ," added Jonathan Hoyle.
"Through PZL Mielec, which sustains employment for more than 1,500 workers directly and thousands more across the Polish supply chain, we are already an integral part of Poland's defence industrial sector. We believe this agreement will lead to an even deeper partnership with Poland, supporting hundreds more jobs within PGZ member companies and boosting the contribution the defence industry makes to the national economy."
The new letter of intent underpins Lockeed Martin's position as a trusted partner for Poland's national defence. With an office in central Warsaw for nearly 20 years, the company partners with the Polish Ministry of Defence on a variety of programmes including Air Sovereignty Operation Centres; F-16, which is a cornerstone of the Polish Air Force; Sniper advanced targeting pods; C-130 and Aegis Ashore.
Through Lockheed Martin's acquisition of Sikorsky in December 2015, the company directly employs more than 1,500 people in Poland and helps sustains thousands of additional high-value engineering and manufacturing jobs in the national supply chain.
About Polska Grupa Zbrojeniowa
Polska Grupa Zbrojeniowa (PGZ) is a leader of the Polish industry and one of the largest armaments holdings in Europe. It unites over 60 companies (from the following industries: defence, shipbuilding, new technologies) and generates an annual revenue of PLN 5bn. Thanks to the utilisation of the potential for nationalising technology, close cooperation with Polish scientific circles, and pressure on the research and development process, PGZ is offering innovative and security-improving products. PGZ's offer comprises, among other things, a very short range air defence system with the POPRAD system and the SO A radar; a portable anti-air GROM system; the E-310 unmanned air vehicle system; the ROSOMAK armoured personnel carrier; an artillery system with the KRAB self-tracked howitzer; and individual personnel equipment with BERYL assault rifles. Additionally, PGZ possesses competence in the field of designing, constructing, and equipping military ships. Moreover, PGZ has been modernising and maintaining vehicles, airplanes, helicopters, and military ships (including but not limited to the equipment produced in former USSR). In the nearest future, PGZ will be developing space and satellite technologies as well as cybertechnologies.
DJ Boeing Challenges Loss in Danish Combat Jet Competition -- Update
The Boeing Co. is challenging Denmark's decision to pick another company's aircraft in a closely watched combat jet competition highlighting the importance of export deals to U.S. fighter plane makers.
Denmark this year said it would buy the Lockheed Martin Co. F-35 Joint Strike Fighter, the Pentagon's biggest weapons program. Boeing had offered its F/A-18 Super Hornet. The Eurofighter Typhoon, built by a consortium of Airbus Group SE, BAE Systems PLC, and Leonardo-Finmeccanica SpA also lost out.
Though U.S. contractors often challenge Pentagon decisions, such action is rare overseas.
"We believe the Ministry's evaluation of the competitors was fundamentally flawed and inaccurately assessed the cost and capability of the F/A-18 Super Hornet," Debbie Rub, vice president and general manager for global strike programs at Boeing, said Thursday.
The Danish Defense Ministry in May recommended the purchase of 27 F-35 combat planes to replace the country's aging F-16 jets. Denmark has been using the F-16, also made by Lockheed Martin, in the Middle East as part of the coalition striking Islamic State targets. The decision was later endorsed by the government in June.
Denmark said it planned to take delivery of the planes between 2021 and 2026.
The decision was a setback for Boeing, which has been scrambling for export orders to keep the F/A-18 in production. U.S. orders for the plane are nearing an end. "We're taking this step because there's too much at stake for Denmark and, potentially, other countries considering the Super Hornet," Ms. Rub said.
Boeing has slowed production to just two jets a month, though the company has become more confident over the past year that it can keep the line in St. Louis open into the 2020s.
Dan Gillian, the jet's program manager, said this week Boeing was confident about securing additional orders from the U.S. Navy. It is also trying to complete an order for as many as 28 planes from Kuwait that is still awaiting final U.S. government approval after Israel raised concerns about the planned deal.
Boeing also remains hopeful it can secure a share of Canada's plan to update its fighter fleet after shelving an initial plan to acquire F-35s from Lockheed Martin Corp.
The Danish Defense Ministry published its selection criteria and said the F-35 won in all categories covering everything from military performance to industrial aspects. The document angered both losing bidders.
Boeing said it has submitted a so-called Request for Insight to the Danish Defense Ministry, requiring it to turn over documents related to the decision.
The ministry said Boeing would be given access to the information. A spokeswoman said the process had been "transparent" and led to broad political agreement. "It is natural that in a process like this only the company that wins ends up being satisfied," she said.
Airbus, which led the losing Eurofighter bid, Wednesday said it noted Boeing's move "with interest." The Toulouse, France-based plane maker said "we have similar concerns about the rigor of the competition and the quality of the technical assessment of the candidates."
Airbus said it remained in talks with the Danish government to have those concerns addressed.
Morningstar look at Defense A Closer Look at Trump's 10% Defense Spending Increase Investors are optimistic, but we see many unknowns. By Chris Higgins | 03-03-17 | 06:00 AM | Email Article
Reports surfaced this week that President Donald Trump’s administration plans to increase fiscal 2018 defense spending significantly. The administration’s initial statements coupled with the budget and political environment confirm our forecast of around $650 billion in defense spending for fiscal 2018, of which $625 billion-$630 billion will go to the Department of Defense. We view the major defense contractors we cover-- Lockheed Martin (LMT), Northrop Grumman (NOC), Raytheon (RTN), General Dynamics (GD), Boeing (BA), and L3 Technologies (LLL)--as fairly valued to overvalued. We think investors are pricing in sizable defense spending increases with little regard for the hurdles the defense budget will need to surmount. A budget outline should go to Congress by March 16 with a more detailed plan anticipated by May. If spending levels come in higher than we expect or certain programs receive funding increases, we may revisit our fair value estimates.
New Office of Management and Budget head Mick Mulvaney outlined a base defense budget, which excludes funding for overseas contingency operations, of $603 billion. Predictably, confusion has set in regarding the actual increase the Trump administration is looking for and what this means for the industry. We’ve seen reports of a $54 billion increase in defense spending, Sen. John McCain complaining about only getting a 3% increase, and other reports mentioning a 10% increase.
The Obama administration requested $552.8 billion in defense spending for fiscal 2017 and planned $586.2 billion for fiscal 2018. Comparing that plan for fiscal 2018 with $603 billion yields a 2.9% increase, hence McCain’s complaint. The $54 billion figure compares the $603 billion figure with the Budget Control Act of 2011, which caps defense at $549 billion for fiscal 2018. The 10% increase--assuming some rounding--may be referring to either the Trump administration’s defense budget increase versus the fiscal 2017 request or the Budget Control Act caps for fiscal 2018, or both.
But there are still many unknowns at this stage in the budgeting process. The $60 billion question is the overseas contingency operations account, which is not included in the $603 billion figure. Our sense is that Mulvaney detests the use of the OCO to circumvent Budget Control Act caps, but defense hawks in Congress have proved more than willing to use it as a slush fund for priorities that don’t fit into the base defense budget. The fiscal 2017 OCO budget request was $58.8 billion, and it’s highly likely that the Trump administration will add about $30 billion to this amount via a defense supplemental spending bill. Despite budget hawks’ distaste for it, we assume that the Trump administration will generate an OCO request as part of the fiscal 2018 budget process, which implies a total defense budget request for fiscal 2018 of well over $650 billion: $603 billion base funding plus our assumption of at least $50 billion in OCO funding.
The Democrats in the Senate (the Republicans effectively control the House) can still filibuster the defense budget; in the past, they have typically demanded parity in defense and nondefense discretionary spending increases. Republicans need 60 votes to circumvent a filibuster in the Senate, which means 8 Democrats will need to defect. In 2016, Senate Democrats did not shy away from using the filibuster against the defense spending bill in Congress; this is why the Department of Defense is still operating under a continuing resolution, which freezes funding at the previous year’s levels and prohibits new-start programs. We think it’s a distinct possibility that Congress will finally agree on the fiscal 2017 defense budget, but any fiscal 2018 proposal triggers a filibuster and potentially another continuing resolution that can--particularly if it lasts deep into fiscal 2018--create challenges for industry financial performance.
Then there is the budget math. The Trump administration and congressional Republicans want to enact sizable tax cuts for corporations and individuals. Trump also continues to push an infrastructure plan, and we note his recalcitrance toward Medicare and Social Security spending reforms. We also note that recent statements from Trump do not emphasize a balanced budget.
To offset other priorities, administration officials have pointed to cuts in other discretionary spending as bill-payers for the planned defense budget increase. The administration has put forward a top-line figure for nondefense discretionary spending of $462 billion, which is roughly $100 billion below fiscal 2016 actual levels and about $54 billion below the caps mandated in the Budget Control Act for fiscal 2018. Our view is that most senators and representatives won’t find these cuts to other discretionary spending politically palatable and that a comprise will be required.
Another wild card is GDP growth. Assuming average real GDP growth of 1.8% annually and no change to current law, the Congressional Budget Office projects persistent deficits of around 3% of GDP through 2020. If annual real GDP growth goes above 3%, then the budget math looks better. But 3% real GDP growth hasn’t been achieved in over 10 years, and the longest consecutive stretch in which the real GDP increased by 3% or more each year was 1983-89. Moreover, promises of faster growth in the face of rising budget deficits combined with no entitlement reform may lead to revolt among the 30-40 Freedom Caucus members in the House of Representatives.
Although the administration’s budget will face hurdles, we view these first broad outlines as an opening gambit to set the negotiating terms with Congress. The next major milestone for investors will be the formal release of the budget request to Congress. Mulvaney is promising to send a budget outline to Congress by March 16 and hopes to flesh out a more detailed budget plan by mid-May. Regardless of timing, we plan to analyze the president’s defense budget request in detail for investors.
After the request goes to Congress, it is a long and winding road through committees and ultimately to a possible vote later this year. Again, we think Democrats in the Senate and potentially fiscally conservative Republicans could block spending increases, which could lead to a continuing resolution, effectively freezing the budget at previous-year levels. In the end, this all may be headed toward another bipartisan stopgap measure--Congress has agreed to several in the recent past--that revises upward but does not completely repeal the caps on defense and nondefense discretionary spending.
In the interim, we think the fiscal 2017 defense budget that the Obama administration put forward last year might finally get through Congress, albeit seven months after fiscal 2017 started, thereby ending the continuing resolution under which the Department of Defense is currently operating and providing defense contractors with more clarity. We also believe an OCO increase via a separate defense supplemental spending request is likely.
Under: Been on the sidelines for a bit holding (building) cash. Now that "BIGLEY" has rolled out the tax plan its time to jump in.
Dec 21, 2017 19:06:02 GMT -6
martyc: Looks like you are buying Msft again!
Dec 15, 2017 11:23:29 GMT -6
martyc: The news that Trump called Rupert to congratulate him sure seems to indicate that this is heading to approval
Dec 15, 2017 11:22:23 GMT -6
Under: DIS finally getting some traction.?
Dec 14, 2017 17:08:45 GMT -6
martyc: I took an entry level position in DIS. Will add eventually to overweight when it becomes clearer that the deal will go thru. Can't believe how well positioned they will be. 60% Hulu. 20% of content watched on NFLX they can pull. More in thread
Dec 14, 2017 11:05:16 GMT -6
Under: Great posts on $DIS
Dec 13, 2017 17:50:49 GMT -6
Under: $ROKU Citron on a war path.
Nov 28, 2017 15:11:20 GMT -6
Under: $HAS takeover bid for $MAT?
Nov 10, 2017 16:16:07 GMT -6
martyc: Not looking like the market will provide any discounted opp for SGMO. Call was just too professional and all signs indicate they are on a great path for commercialization. Happy with core but wish I had some trading shs
Nov 10, 2017 9:04:05 GMT -6
martyc: For anyone looking to find an entry point into SGMO, I'm almost hoping is sells off in next few days so I can add more. They are really clicking but the fact they haven't signed new deals might cause some to exit. Watching as I have room for trading shs
Nov 9, 2017 18:28:09 GMT -6
martyc: Been an interesting ride so far. I figured the Bears would be about this good but hoped the O wouldn't look so lame. Another building yr but still possible to get to 8-8 IMO
Nov 9, 2017 18:26:08 GMT -6
Under: whats up with your Bears this year Marty?
Nov 9, 2017 17:35:25 GMT -6
martyc: Hope you were long ROKU. I wanted to see Q first so missed out
Nov 9, 2017 7:08:53 GMT -6