This one's a hummer.
The stock for Engineered Support has recently gone up in price but can still be considered a bargain when considered against it's peer industry.
Engineered Support Systems is a holding company which consists of two elements: 1.)Engineered Air Systems: designs, markets, and manufactures defense systems, air conditioning & heating systems (for military aircraft) and distribution systems; 2.) Engineered Specialty Plastics: manufactures injection molded plastic products for commercial and military applications.
For the latest quarter (ending 4/97) revenues rose 21% to 46.3M and net income rose 58% to 1.9M. There are about 3.2M shares outstanding with 1.9M in the float.
The company has recently taken a more aggressive marketing stance and has cut back on S/G/A costs to both increase sales and increase margins. The company has a large cash position and is actively seeking acquisition opportunities. The Federal Government, with which the company does most of its business, has recently raised the number of employees a small company can have and still be considered small (from 500 up to 1000). Small company status allows, among other things, in progress payments while a contract is being completed.
The company has a backlog of more than $100,000,000. Current estimates on the street do not include either additional contracts or potential acquisitions only in house work and DOD options.
There is a good article in the Investor's Business Daily for June 23rd 1997.
Engineered Support Systems
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