21 buzzwords Goldman Sachs thinks every investor should know by now
Sector affected: Aeronautics and defense
Space is crowded.
“Space congestion is the result of more than 50 years of launches, operations and accidents,” wrote Goldman analyst Noah Poponak. “When satellites are destroyed, they litter certain orbital pathways with shrapnel that can propagate and destroy other satellites, creating an exponential risk effect. Major space powers like Russia, China and the United States United conducted anti-satellite weapon tests which created vast fields of debris. “
The more congested space becomes, the more current operational satellites will have to maneuver around this debris, “shortening their lifespan and perhaps closing the door to revolutionary new space applications,” he wrote.
This gives aerospace and defense companies the opportunity to develop technologies to identify more (possibly smaller) space objects as well as develop safe operational practices.
Beneficiary companies: Boeing
, Lockheed Martin
, Orbital ATQ
, Northrop Grumman
Lockheed Martin is a holding Jim Cramer’s Action Alerts PLUS Charitable Trust Portfolio. Cramer and Action Alerts Plus Research Director Jack Mohr wrote in a recent weekly roundup:
While the company is well positioned for a profit inflection in 2017, we can’t help but recognize that the second half of this year is set to prove complicated as LMT finalizes the integration of the business of Sikorsky helicopters which it purchased from United Technologies UTX. From a macro perspective, however, we are confident that management will find ways to create value in an environment of low rates, weak growth and unpredictability. It has a remarkable history of return of capital via constant dividend increases (the stock returns 2.7%) and large stock buybacks.