Zacks Analyst Interview Highlights: DRS Technologies, L-3 Communications, Lockheed Martin and Northrop Grumman.

CHICAGO -- Zacks.com releases the latest Analyst Interview. Today's interview is with senior analyst Jon Kolb, who discusses DRS Technologies (NYSE: DRS), L-3 Communications (NYSE: LLL), Lockheed Martin (NYSE: LMT) and Northrop Grumman (NYSE: NOC).

A synopsis of today's Analyst Interview is presented below. The full article can be read at http://at.zacks.com/?id=2678.

Is the anticipation of an eventual down-cycle [in Aerospace & Defense] being pushed further out based on relatively new geopolitical tensions with Iran and elsewhere?

While I agree with your notion that any pending A&D industry downturn may be further postponed due to Iran, North Korea, or whichever country makes news headlines next, I think the world in which we now live is that national defense and Homeland Security will be permanent active entities in our lives. Personally, I do not anticipate much of a downturn post-Iraq, and therefore a down-cycle in the Defense industry doesn't look very likely from my perspective.

Defense stocks seem as if they would work as "defensive" plays, if you'll pardon the expression. Can Aerospace stocks be thought of in a similar way?

Well, if you consider a good "defensive" play to be a company, industry or market segment that faces relatively stable and constant demand for its products or services throughout every stage of the business cycle, then Defense stocks are indeed - for lack of a better word - defensive. The vast majority of revenue generated by defense contractors comes from government entities. Governments tend to be relatively immune to the business cycle since they are less beholden to pressures in the market that other industries are.

But Aerospace is more cyclical and more closely tracks macroeconomic factors. Besides which, planes tend to have relatively long lives, and no airline is going to buy new planes when passenger traffic is declining. So no, I do not consider aerospace as a good place for investors to park their money during a market decline or possible recession if they want to protect their principal value.

Which are your favorite Buys in this space right now?

Currently, we favor DRS Technologies (NYSE: DRS), a pure-play defense contractor and a leading supplier of defense electronic systems; L-3 Communications (NYSE: LLL), which was awarded a 10-year contract worth $1 billion to provide services for the U.S. Air Force and U.S. Navy aircraft program; Lockheed Martin (NYSE: LMT), the largest defense contractor in the world; and Northrop Grumman (NYSE: NOC), which is positioned to take advantage of high growth areas in the U.S. Defense budget.

Read the full interview at http://at.zacks.com/?id=2647.

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