via Motley Fool
....we're fascinated by the Armata -- and how its invention might affect investor portfolios back here in the U.S. For example, General Dynamics (NYSE: GD ) builds tanks for the U.S. military, while iRobot (NASDAQ: IRBT ) builds smaller military robots. Might a perceived threat from Russian "robo-tanks" like the Armata tank prompt a merger -- or at least a collaboration -- between these two U.S. defense contractors?Motley Fool is an interesting site. They've been extremely bullish on the F-35 and have recently moved to a more neutral stance. Additionally they have a focus on defense issues that I find...amusing. I don't often agree with them but it is fun to see what the people on Wall Street think (assuming they're representing "conventional wisdom").
Unless the Pentagon is willing to permit a "robot gap" to open between U.S. and Russian military capabilities, such a team-up might be necessary. Disturbing as the prospect of a new arms race between the U.S. and Russia might be, such a development would certainly benefit U.S. defense contractors.
At General Dynamics, for instance, slack sales of battle tanks recently forced the company tolay off hundreds of workers at its Lima, Ohio, Abrams tank plant. iRobot has been hurt nearly as hard by the drawdown of U.S. forces in Iraq and Afghanistan. Revenues at the company's Defense and Security business, responsible for PackBot sales to the military, fell from a 2011 high of $175 million in sales to just $50 million in the most recent fiscal year, according to S&P Capital IQ data -- about where the company was a decade ago. Working off such a small revenue base, it wouldn't take much of an investment in robo-technology by the Pentagon to move the needle at iRobot.
Anyway, read the entire article here.
