Force Protection Offers to Double Blast-Resistant Truck Output 2007-06-07 10:15 (New York)
By Edmond Lococo June 7 (Bloomberg) -- Force Protection Inc., a maker of mine-resistant trucks, has offered a plan to the U.S. military to double output during the next 18 months to speed delivery of the vehicles to troops in Iraq.
The company offered to produce a total of 12,000 of the Mine Resistant Ambush Protected vehicles, or MRAPs, by the end of 2008 through a joint venture with General Dynamics Corp., Michael Aldrich, a vice president of Ladson, South Carolina-based Force Protection said in an interview today.
Reaching the target would require boosting manufacturing to 800 vehicles a month, compared with current plans for 400, Aldrich said. U.S. forces suffered in May their deadliest month in Iraq since November 2004, and Defense Secretary Robert Gates said May 9 that faster acquisition of blast-resistant trucks is the Pentagon's top procurement priority.
Force Protection has received the second-largest order for the trucks to date: a $481.4 million contract for 1,000 of the vehicles awarded in April. It produces the trucks through its joint venture with Falls Church, Virginia-based General Dynamics. The largest MRAP order so far went to Navistar International Corp. in Warrenville, Illinois, last month for $623 million to build 1,200 trucks.
Force Protection won't raise output without additional military contracts, Aldrich said.
``It would be improper for a publicly traded company to ramp up on its own initiative and spend a lot of shareholder money possibly in the wrong direction,'' Aldrich said.
U.S. Marine Corps spokesman Bill Johnson-Miles said he didn't immediately have information on the production plan.
Shares of Force Protection gained $1, or 4.2 percent, to $25.12 at 10:04 a.m. in Nasdaq Stock Market composite trading. Before today, they had risen 39 percent so far this year.
--Editor: Zahradnik
-------------------- "Great Day for Up!"....Dr. Seuss
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Want a surprise? There's not much difference between us rebel investors at Motley Fool Rule Breakers and our cheapskate cousins at Inside Value. We both seek to profit from mispriced stocks.
The key difference is that while Philip Durell and his bargain bunch have no problem buying into pessimism, we rebels prefer to buy into skepticism. That is, we believe the ***********s in the making, while not often cheap by the numbers, are always misunderstood. That's what makes them excellent value stocks.
Anatomy of a *********** Think of NYSE Euronext (NYSE: NYX), which David Gardner picked in February 2005, when it was still the highly disruptive Archipelago Holdings, owner of an electronic stock exchange that was steadily gaining ground.
It was anything but an obvious pick. Archipelago, after all, wasn't a fast mover at that point. Revenue growth had temporarily gone flat by the time of the recommendation.
Most investors overreacted to that blip. Some even bet against Archipelago by going short. Not David. He remained focused on the superior economics of electronic trading, figuring it would become a multibillion-dollar business so long as investors continued to put money into stocks.
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CAPS applies user input to rate stocks from one (low) to five (high) stars. Using CAPS, we're going to search for one- and two-star stocks that have at least 5% of their shares outstanding sold short but are expected to grow earnings by no less than 15% over each of the next five years.
Let's have the list Now, with that preamble behind us, here are five unloved growth stocks:
Company CAPS Rating Short Interest 5-Year Growth Estimate
Force Protection (Nasdaq: FRPT) ** 13.2% 30.0%
ICU Medical (Nasdaq: ICUI) ** 16.3% 16.0%
Deckers Outdoor (Nasdaq: DECK) ** 15.2% 15.3%
Advanced Micro Devices (NYSE: AMD) ** 13.3% 15.2%
Rural Cellular (Nasdaq: RCCC) ** 5.1% 15.0%
Sources: Motley Fool CAPS, Yahoo! Finance.
Bear in mind that this isn't a list of recommendations. Instead, I offer these stocks as candidates for further research. But of these five, it's ICU Medical, which produces intravenous devices meant to protect health-care workers from disease, that interests me the most. CAPS All-Star tmd6966 explains the thesis:
New product launches, extremely efficient [manufacturing] process. Cost-cutting measures will begin to expand operating margins, new products will have similar effect, sitting on [more than $8] cash per share for possible acquisitions.
Intrigued? Do your own due diligence, and then check in with thousands of other investors at CAPS. And if you'd like, add your own commentary. You'll be helping your fellow Fools and testing your ideas at the same time. Get started now; the service is 100% free.
See you back here next week for five more unloved growth stocks.
NYSE Euronext is a Rule Breakers recommendation.
Fool contributor Tim Beyers, who is ranked 4,227 out of more than 29,800 rated players in CAPS, is a sucker for growth stocks and a regular contributor to Rule Breakers. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Tim's portfolio holdings can be found at his Fool profile. His thoughts on growth stocks, Foolishness, and investing in general may be found in his ****. The Motley Fool's disclosure policy is your portfolio's competitive advantage.
posted
I actually did sell a small amount at a loss for $24.50 the other day. But the reverse midas touch didn't work. And I really wanted it to for the rest of my shares. My account is seriously bleeding.
-------------------- "Great Day for Up!"....Dr. Seuss
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posted
I'm not positive if this is why, but I was considering buying the stock this morning until I looked at the Acc/Dist last night. It broke under its low for the last 6 months yesterday. So, I decided against buying it luckily. Thats about the only thing on the chart that I saw that broke down until today. I hope it rebounds though, cuz my dad owns some. GLTA
Try to make it back in CRWN, thats where I'm puttin my money on monday if it keeps looking good.
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Force Protection is doing just fine thank you. Revenues & profits are growing at over 300% compounded annually. They make the worlds gold standard of MRAP vehicles.
The demand for MRAPS is growing exponentially to the point where the entire MRAP pie has grown from a few thousand vehicles to around 23,000 vehicles. In addition FRPT's Cheetah is the odds on leader in the race to replace all the 170,000 Humvees around the world
So what the heck has caused FRPT's price to hit an all time high of $31 only to drop to $23.88? The simple answer is fear of competition. Early this year we were told that nine companies would be supplying their vehicles to the DOD's Aberdeen IED testing grounds. It was understood at the time that FRPT's vehicles had a technological moat around them that all but BAE systems (to some extent) could not overcome.
Now that the testing period is over, we will find out just how wide that moat is. In my opinion, FRPT's technological moat is insurmountable. However, that might not matter to our Defense Department because even at FRPT's great growth rate, FRPT can not possibly produce all the MRAPs required to protect our troops. As a consequence, the armed services might have to order some lesser quality vehicles from FRPT's competitors. Hopefully these vehicles will be able to protect our troops. Let's face it, anything is better than a Humvee.
We know that FRPT has continued to ramp up production and has guaranteed that with GD they can produce over 12,000 vehicles by December 2008. FRPT's management has repeatedly stated that the DOD has told them that they will get all the orders that they can produce. That all but insures that FRPT's revenues will more than triple again, exceeding $2 billion in 2008.
So now back down to Earth with my analysis. FRPT is growing faster than any company in America and will get contracts for all the vehicles they can produce. In all reality, the Defense Department has no choice in the matter, because they can not afford to fool around with our troop's lives. Nevertheless, it is obvious that other contractors will be given some business. The confusion caused by the recent lull in orders, the stock market's wipeout, some insider sales, and the award of a large contract to NAV has caused a shakeout in FRPT's share price.
It is my belief that NAV will have a hard time proving that it can deliver high quality MRAPs on time. There is something fishy about how the NAV contract was awarded out of the blue with the aid of Senator Trent Lott. It is also my understanding that BAE systems is having a hard time passing the tests at Aberdeen.
It should be noted that in past times of war, the DOD has ordered other contractors to produce the DOD's preferred vehicle. Hence, it would be logical for the military to force all vendors to use FRPT's technology under a licensing or subcontract arrangement with FRPT
In short, it's time to fasten your seat belts because many major questions are going to be answered by month's end. Next week we have the GD investor conference. On June 21st FRPT will hold it's annual meeting. Lastly, we are about to hear from the DOD about who is going to be awarded MRAP contracts and how much of the pie FRPT is going to get.
Oh yes, there is the strong possibility that GD will buy FRPT lock stock & barrel. So it's time to scale back in to the portion of the FRPT shares that we sold in the high twenties.
-------------------- "Great Day for Up!"....Dr. Seuss
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Yea, out last Thursday, back in again yesterday morning when it went green. Stop set at 24.50 for now, needs to close above 25 or I'll be out eod.
-------------------- ......in Psychiatry circles it's known as a "warning sign"
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By Melissa Davis Senior Writer 6/13/2007 12:08 PM EDT
Force Protection (FRPT - Cramer's Take - Stockpickr) rolled higher Wednesday after the maker of blast-resistant military trucks said its stock will join the Russell 3000 index at the close of trading next Friday.
The Ladson, S.C., company said the move "is truly a milestone for our growing company." The Russell 3000 Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization. Shares rose $1.37 to $25.22.
-------------------- "Great Day for Up!"....Dr. Seuss
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I'm resisting the urge to sell yesterdays shares right now at $26.00. Seems it always dips back down before the close and I could preserve a couple of hundred in gains, by selling and buying back. But then, there's that "jo effect".
Must...resist...urge..
-------------------- "Great Day for Up!"....Dr. Seuss
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Force Protection Gains Ground - AP NEWS Wednesday June 13, 3:38 pm ET http://biz.yahoo.com/ap/070613/force_protection_mover.html?.v=1 AP Force Protection Gains Ground Wednesday June 13, 3:38 pm ET Force Protection Rises After Partner Increases Alabama Operations
NEW YORK (AP) -- Force Protection Inc. shares jumped Wednesday after an analyst said the maker of blast-protected vehicles is preparing to ramp up production. Force Protection is filling a U.S. Marine Corps order for 1,000 Mine Resistant Ambush Protected vehicles. General Dynamics, which has a $244.5 million contract with Force Protection to help complete the order, said Tuesday it is adding 320 jobs and spending $2.6 million on two Alabama facilities connected to that contract.
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SunTrust Robinson Humphrey analyst Chris Donaghey said Force Protection is looking to increase its production, and will need to place some large orders to do so. He believes General Dynamics is expecting a larger contract, because the current one is too small to justify what it is spending.
"In our opinion, General Dynamics would not be making an investment in these facilities for a 1,000 vehicle contract and we believe this move by General Dynamics implies it expects to see significantly larger awards," the analyst wrote in a client note.
He maintained a "Buy" rating on Force Protection shares, noting that the stock has slipped 23.5 percent since touching a seven-year high on May 22.
Force Protection also said it is being added to the Russell 3000, an index of the 3000 largest publicly traded companies measured by market capitalization.
Shares of Force Protection rose $1.85, or 7.8 percent, to $25.70.
General Dynamics shares added 82 cents to $80.06.
-------------------- "Great Day for Up!"....Dr. Seuss
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