L-3, ViaSat Sign Comm. Contract - Analyst Blog

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A business arm of L-3 Communications ( LLL ), Platform Integration Division, announced that it has signed a memorandum of agreement with ViaSat Inc . ( VSAT ) to offer advanced in-flight connectivity capabilities to private transport aircrafts.

Per the agreement, both the companies will jointly work on a broadband satellite communication system for high-end aircrafts used by Heads of State and high-profile clients.

The new communication features include an airborne shipset and worldwide broadband network services that will be provided by ViaSat. L-3 Communications will deliver system integration, installation, engineering, design, in-cabin passenger networking and certification facilities.

This is the second communications-related deal signed by L-3 Communications following the recent $39.0 million dual satellite telecommunication terminal contract with the Australian Defense Force. This reflects the company's aggressive pursuit of options to develop this business segment.

With its varied businesses, L-3 Communications has managed to maintain a stable earnings flow. Going forward, better prospects from overseas customers are expected to lead to earnings accretion. In the first quarter 2013, L-3 Communications' international business registered 18% growth.

The combined efforts towards the development of the new technology will be a profitable addition to L-3 Communications' logistics business. The company's overall bookings at the end of 2012 stood at $10.9 billion. In the first quarter 2013, its backlog of orders remained solid at $10.5 billion which will lend significant upside to returns.

However, austerity in defense budget will continue to act as a deterrent to L-3 Communications' broad growth objectives. The company presently carries a Zacks Rank #3 (Hold).

Other stocks in the defense domain currently performing well are Wesco Aircraft Holdings, Inc. ( WAIR ) and MTU Aero Engines Holding AG ( MTUAY ). Both holds a Zacks Rank #2 (Buy).

Headquartered in New York, NY, L-3 Communications offers command, control, communications, intelligence, surveillance, and reconnaissance (C3ISR) systems; aircraft modernization and maintenance; and national security solutions in the United States and internationally. Currently, it has a market capitalization of $7.58 billion.

L-3 COMM HLDGS (LLL): Free Stock Analysis Report


VIASAT INC (VSAT): Free Stock Analysis Report

WESCO AIRCRAFT (WAIR): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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