Rockwell Collins
designs manufacturers and supports aviation electronics and mobile and airborne
communication systems, navigation, display and automatic flight control systems
to multinational corporations and defense and electronic system products for
airborne, ground and shipboard applications for domestic government
agencies. The company has grown earnings
and dividends 16-18% annually over the last five years while earning a 35%+
return on equity. Despite the impact of
the economic malaise on the airline and private aircraft industries, earnings have
resumed their long term growth rate due to:
(1) it is the
largest supplier of communications and avionic equipment to both the commercial
and military markets,
(2) it benefits
from spending cuts as focus shifts to upgrading existing equipment,
(3) stock
buybacks.
Negatives:
(1)
a majority of its contracts are fixed price creating a
problem if there are cost overruns,
(2)
its exposure to the cyclical aerospace market,
(3)
a large percentage of its sales are overseas so it
subject to foreign laws, regulations and policies.
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio
Since 2002
Debt/ EPS Down Net Value Line
Equity ROE Since 2002 Margin Rating
* the majority of companies in COL
Chart
Note:
COL made good initial progress off its March 2009 low, quickly surpassing the
downtrend off its October 2007 high (red line) and the November 2008 trading
high (green line). Long term, COL Buy Value
Range Sell Half
Range
12/12`
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