StockCall Scans Textron and Raytheon: Aerospace Stocks Provide Flying Returns

Feb 20, 2013, 08:00 ET from

LONDON, February 20, 2013 /PRNewswire/ --

Defense companies performed well but face a new set of challenges. The economic scenario is improving, easing the price pressure, but the looming fear of economic sequestration may turn out to be a dampener for these stocks. The spending cuts are expected to have negative impact on these companies. However, most of the stalwarts in the industry are ready to face the challenge and have been concentrating on developing new product lines to keep the positive momentum going on. Textron Inc. (NYSE: TXT) recently won a number of new contracts and its stock marked a new high. Raytheon Co. (NYSE: RTN) is also doing well by introducing new products. Overall, the combat equipment companies are well armored to fight this new battle. StockCall has taken an interest in these companies and you can now sign up to download the free technical research on Textron and Raytheon at  

Textron Expects Better Cessna Demand

Textron's stock is in a bull's run and recently touched its new 52-week high. The company won a couple of good contracts lately and the stock seems to have taken the instances in a positive light. The stock is up 20 percent so far this year and the momentum is likely to continue into the future. Textron reported robust results for its fourth quarter. Its adjusted net profit stood at 56 cents per share and beat consensus estimate of 55 cents per share. Its revenue also inched up 3 percent to touch $3.36 billion. The sales figure lagged behind the expected number of $3.42 billion. Sign up today to read the free research report on Textron Inc. at  

Textron is a leading corporate aircraft manufacturer. Thus, its fortunes are very closely tied to the economic revival and corporate spending. While its Cessna sales remained subdued, the company witnessed good demand for its commercial and military helicopters.  However, Textron also expects Cessna volume to pick up during 2013. The company's stock is expected to perform well on the back of these positive catalysts. Textron has the benefit of exposure to both civil and defense projects, and thus it is well placed to keep up its growth process.

Textron is also moving ahead with new product developments. It recently launched two new vehicles under its Commando marquee. The vehicles are designed for international combat units.

Raytheon Offers High Dividend Yield  

Raytheon is one of the most prominent players in the defense contracts field. The company offers good investment opportunity as the stock dropped 3 percent in the past 12 months and provides a good entry point for long-term investment. Raytheon is also a good income opportunity as its current dividend yield stands at 3.68 percent. It performed well in 2012 but owing to defense spending cuts, the company expects a mild decline in its revenue. However, the impact of this low guidance is already baked into the stock price. Register to download the free technical analysis on Raytheon Co. at  

Raytheon expects to make up for sequestration effects by focusing on its international business. The company is also looking to make its products and programs more affordable. The step will help Raytheon in boosting the demand. It is also taking steps to curtail the costs and to boost margins. The company introduced a wide range of products to keep its portfolio diversified. Raytheon's stock is expected to recover its losses in the near future.

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