Secure Communications

08/19/2005 12:00 am EST

Focus:

Vahan Janjigian

Editor, Bottom Line's Money Masters Stock Report

Quantitative analyst Vahan Janjigian compiles a list called the Forbes Growth Investor Top 50 , based on expectations for year-ahead performance. Two of the latest additions to this list are involved in high-tech areas of military and civilian communications.

"Rockwell Collins (COL NYSE) supplies communications and aviation electronics to military and commercial customers. It operates more than 60 service centers worldwide, but generates about 70% of its revenues in the US. Other key markets include France, Canada, Australia, China, Japan, Germany, Israel, Singapore, Brazil, and the UK. Its products include navigation systems (e.g., global positioning systems and handheld navigation systems), flight deck surveillance systems, cockpit display systems, and computer applications for future combat systems.

"Military modernization is a top priority in defense budget proposals, which has led to a steady flow of large orders such as lightweight tactical radios for the Army and handheld navigation devices for the GPS Joint Program Office. The Air Force selected COL to be the prime contractor to upgrade fixed and deployable equipment. Management expects firm demand for its military and commercial systems throughout the remainder of the year. Military activity in Iraq and Afghanistan is accelerating demand for tactical radios and navigation devices.  On the commercial front, the firm makes flight controls and displays, in-flight entertainment systems, and cabin electronics and should benefit from surging demand for business jets."

"Harris Corp. (HRS NYSE) is a global provider of secure communications products to government and commercial customers. The firm makes and supports advanced communications networks and equipment for gathering intelligence, providing surveillance and conducting reconnaissance. Products include deployable satellite antennas and other spaceborne communications systems, high-frequency satellite ground terminals for the Department of Defense (DoD), high-speed communications systems for next-generation military aircraft, and equipment and systems for national and homeland security applications.

"Harris also designs and supplies products for secure wireless voice and data communications to the DoD and other government agencies. Products include secure radios for portable, mobile, strategic fixed-site, and shipboard operations, used to encrypt transmissions. Offerings consist of encoding and transmission equipment for analog and digital radio and television broadcasts, studio equipment, and equipment used by TV stations to monitor, control, and manage broadcast systems from a central location. Meanwhile, we expect government spending for the kinds of products Harris produces to remain a top priority."

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