Alliant Techsystems Inc. (ATK) has received a contract worth $30 million from the U.S. Army to supply non-standard (non-NATO) ammunition ("NSA") to the security forces of Afghanistan.
Alliant has a strong footing in the NSA market as the company, apart from providing ammunitions, also offers technical assistance, assures quality, and supports a supply chain for a variety of non-standard small, medium, and large caliber ammunition, aviation rockets, rocket propelled grenades and mortars.
Alliant has already supplied more than 200 million non-standard ammunition items under an existing multi-year contract. Additionally, the company's ability to consistently deliver ahead of delivery schedule has helped it to secure consistent contracts.
Alliant received its first NSA contract for Afghan forces in December 2008, which was worth $87 million. Per the contract, the company led a global supply chain effort to procure and deliver various small, medium, and large caliber ammunition, grenades, and aviation rockets, including mission-critical 57 mm rockets and 12.7 x 108 mm ammunition. The company completed the delivery before schedule in January 2010.
Within the last seven days, the company has continued to receive successive contracts, securing a couple of medium caliber munitions deals amounting to $28.8 million.
Alliant Techsystems currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We retain our long-term Neutral recommendation on the stock. The company competes with General Dynamics Corp. (GD) and Raytheon Co. (RTN).
Based in Minneapolis, Minnesota, Alliant Techsystems supplies aerospace and defense products to U.S. government agencies. The company also supplies ammunition and related accessories to law enforcement agencies and commercial customers.
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