ITT Wins Contract - Analyst Blog

ITT Corporation(ITT) has won a contract for development of next generation counter-IED system. ITT is the only recipient of the order which is valued at $29 million.

The contract was awarded by The U.S. Naval Sea Systems Command.

The U.S. Naval Sea Systems Command has contracted for an equipment called Joint Counter Radio-Controlled Improvised Explosive Device Electronic Warfare or JCREW .

The system includes portable hand-held units, vehicle-mounted device designed for fixed site installation at military bases. They prevent the detonation of improvised explosive devices.

ITTplays an important role in vital markets, including water and fluids management, global defense and security, and motion and flow control. It possesses to leading brands in the Fluid Technology and Motion & Flow Control businesses. The company is well diversified and serves attractive end markets with a broad geographic footprint.

We are particularly bullish about these two segments: a) water equipment (primarily pumps), which should benefit from the replacement and upgrade of ageing networks in developed markets and the infrastructure in emerging markets, and b) ITT's Defense business, with the bulk of sales derived from electronic and network-centric warfare.

The Defense Electronics & Services business segment is subject to a number of risks, including defense budgets and government contract requirements and regulations, which could have an adverse impact on the results of its operations.

The Fluid Technology and Motion & Flow Control business segments are subject to certain industry risks, which could have an adverse impact on the results of its operations.

Adverse macroeconomic and business conditions, particularly in the local economies of the countries or regions where the company operates, may negatively affect its revenues and operations.

The company's Defense Electronics and Services segment develops, manufactures, and supports high-technology electronic systems and components for worldwide defense and commercial markets, and provides communications systems and engineering and applied research. Principal manufacturing facilities are located in the United Kingdom and United States of America.

ITT Corporation, with 2009 revenues of $10.9 billion, is a global multi-industry leader in high-technology engineering and manufacturing. It is engaged in the design, manufacture, and sale of a wide-range of engineered products and the provision of services. Competitors include Raytheon Company (RTN) and Lockheed Martin Corporation (LMT).

We currently have a 'Neutral' recommendation on ITT Corporation.

 
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