SOURCE: Century Capital Markets

September 28, 2011 14:49 ET

Defense Companies Positioned for Unmanned Aerial Vehicles (UAVs) Forecasted Growth

NOTE TO EDITORS: The Following Is an Investment Opinion Being Issued by the CENTURY CAPITAL MARKETS

NEW YORK, NY--(Marketwire - Sep 28, 2011) - A recent article by Reuters (Drone Makers Seek Out New Targets www.reuters.com/article/2011/09/23/us-drones-idUSTRE78M4HE20110923) outlines the Unmanned Air Vehicle (UAV) industries bet on increased spending for aerial drones. Global spending on drones (UAVs) to nearly double in the next decade, growing to $11.3 billion a year, and suggesting a near $95 billion market within 10.

Both surveillance and armed U.S. drones, which have been widely deployed in Afghanistan and Iraq, have received strong interest from Japan, Australia, Saudi Arabia and nuclear neighbors India and Pakistan. US defense contractors like Boeing (NYSE: BA) which produces the ScanEagle and Lockheed Martin (NYSE: LMT) who produces the tiny Samurai UAV have the technological edge over foreign competitors which gives them greater access to the estimated $4.9 billion global share of UAV spending. (Teal Group www.tealgroup.com/index.php?option=com_content&view=article&id=62:uav-study-release&catid=3&Itemid=16)

Privately held General Atomics manufactures the best-known UAV, the Predator, which has made headlines for its wide deployment by the US military, but public companies have made headlines of their own. Recently, Northrop Grumman was awarded a $2.6 billion contract for its Fire Scout drone and relative new comer to the UAV market, AeroVironment (NASDAQ: AVAV) announced a $6.8 million dollar purchase from the US Air Force for its Raven UAV. Textron which makes the Shadow family of UAV's is a cornerstone of the US Army and Marines drone deployment and niche player in the surveillance UAV market. Mundus Group, Inc. (PINKSHEETS: MNDP) announced today that their AirStar UAV will help patrol the coasts of Texas and Louisiana for government agencies as well as yesterday's announcement of the 10 year anniversary of their electric ducted fan technology, which was co-developed with the US Navy.

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