Alliant Techsystems: A Defensive Defense Play

The aerospace and defense sector has held up fairly well over the past year, with a small percentage gain in the face of a declining overall market. <!----> Some of the strength may be attributed to the continued wars in Iraq and Afghanistan. However, with much talk of troop withdrawal and the ongoing fight in Congress regarding funding, some companies have been hit hard in the past year; e.g. Ceradyne (CRDN)- which makes the ceramic SAPI plates used in individual body armor, and Force Protection (FRPT)- which makes armored vehicles, like the USMC’s new mine resistant ambush protected Cougar vehicle.

Here are the problems with CRDN, FRPT and similar companies: