Aerospace and defense operator
General Dynamics Corporation
) received a follow-up contract worth $53.9 million from the U.S.
Army to produce 13,000 Joint Tactical Radio System (JTRS) Handheld,
Manpack, Small Form Fit (HMS) AN/PRC-154 Rifleman radios and
These advance radio systems will have mobile voice, video and
data communications capabilities, providing soldieries in combat
missions with a vital edge over enemies. The dual channel radio
system will not only allow the transmission of vital information
from the battle ground to the commanders but also allow the
commanders to communicate the development to higher
We believe accuracy and promptness in communication and
subsequent tactical decision and moves provide additional advantage
in the battle field. The importance of the radio system has
prompted the Army to place a follow-up order after an initial order
of 6,000 units. The Army expects to distribute these systems to
Infantry Brigade Combat Teams from October
General Dynamics C4 Systems is part of General Dynamics'
Information Systems and Technology group. C4 Systems will be
entrusted with the responsibility of supplying the necessary
radios. The Information Systems and Technology system has
registered an 11.6% slide in total revenue in the first six months
of 2012. We believe a gradual recovery in orders in the latter half
of the year will help the segment to recover lost ground.
During the second quarter earnings call General Dynamics showed
caution while providing the 2012 earnings per share guidance.
Taking into account the possibility of award delay in the
Information Systems and Technology's tactical communications
business, the company has lowered its earnings guidance range for
2012 to $7.00-$7.10 per share from $7.10-$7.20 per share earlier.
The Zacks Consensuses Estimate for 2012 of $7.10 per share is on
the higher end of the guided range.
General Dynamics currently retains a Zacks #3 Rank (short-term
Hold rating). Some of its main competitors are
Lockheed Martin Corporation
Based in Falls Church, Virginia, General Dynamics, with its
units, operates in business aviation, land and expeditionary combat
systems, armaments and munitions, shipbuilding and marine systems,
and information systems and technologies.
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