Wednesday, December 20, 2006

Trade Ideas: NOC

Given this is another holiday week the markets weren't in the mood to shake things up too much. The Trade Ideas scan was modestly bullish (considering), with 8 picks covering a time span of 6 minutes. By far the most frequent stock to appear on the daily scan at 36 appearances was Northrop Grumman (NOC).

The stock has breached $68.20 resistance, now support, ending a 2-month consolidation triangle/handle. Stops can go on a loss of triangle support and/or the most recent reaction low ($66). A push to $70 would trigger a breakout on the point-n-figure chart, although the current chart target of $55 has long since been met. I would look for a measured move to $80, part of a larger 10-month bullish ascending triangle. The stock pays a 1.80% yield.

Northrop Grumman Corporation provides products, services, and solutions in information and services, aerospace, electronics, and shipbuilding to the military, government, and commercial customers in the United States and internationally. The company provides airborne radar, navigation systems, electronic countermeasures, precision weapons, airspace management systems, space systems, marine and naval systems, communications systems, government systems, and logistics services. It also designs nuclear-powered aircraft carriers and nuclear-powered submarines, as well as provides services for various naval and commercial vessels. The company also offers design, engineering, construction, and life cycle support; and network-enabled integrated systems and subsystems for U.S. government, civil, and international customers. It also supports the military with intelligence, surveillance, and reconnaissance; battle management command and control; and integrated strike warfare. In addition, the company integrates command, control, and intelligence systems; missile systems; strategic missiles; missile and air defense; airborne reconnaissance; intelligence management and processing; electro-magnetic and infrared analysis; communications; and decision support systems, as well as delivers life-cycle solutions for information systems and services; C4ISR; strategic security; engineering and science; training and simulation; base and range operations; and enterprise information technology solutions and products. Further, it develops and integrates spacecraft systems and subsystems, electronic and communications payloads, avionics systems, and laser systems and subsystems.

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