Conglomerates Sector Review: Tyco Earnings, New GE Projects

Textron Inc. (NYSE:TXT): AAI Logistics & Technical Services, an operating unit of Textron Systems, a Textron company, announced that the company has received an award from the U.S. Air Force at Wright-Patterson Air Force Base to provide logistics support and concurrency modifications for the B-1B Training System. The award has a total potential value of $162 million over seven years. Under this award, AAI Logistics & Technical Services will be responsible for operating the B-1B Training System Support Center, located at Dyess Air Force Base in Texas, and providing contractor logistics support for training systems at multiple locations.

The shares closed at $25.43, up $0.22, or 0.87%, on the day. Its market capitalization is $7.07 billion.

Tyco International Ltd. (NYSE:TYC) is expected to report Q1 earnings before the market open on Tuesday, January 31 with a conference call scheduled for 8:00 am ET. Analysts are looking for EPS of 79c on revenue of $4.26B. The consensus range is 77c-86c for EPS, and $4.19B-$4.38B for revenue, according to First Call. Tyco reported positive Q4 results, beating EPS and revenue estimates. On its Q4 conference call, the company guided Q1 EPS and revenue numbers below analysts’ estimates. It forecast Q1 EPS about 77c vs. consensus 83c, and Q1 revenue $4.2B vs. consensus $4.51B. It also said it would make 3-4 acquisitions in the first half of 2012. Despite the weak guidance, the shares have traded modestly higher in the past several months, and currently sit about four points from their 52-week high of $53.38. On November 17, Cowen noted that Tyco’s growth story remained intact. The firm cited the firm’s improved margins, sales growth, and defensive businesses. Cowen placed an Outperform rating on the shares.

The shares closed at $49.21, up $0.01, or 0.02%, on the day. Its market capitalization is $22.72 billion.

ABB Ltd (NYSE:ABB) and Thomas & Betts (NYSE:TNB) announced that both companies’ boards of directors have agreed to a transaction in which ABB will acquire Thomas & Betts for $72 per share in cash or approximately $3.9B. The acquisition price represents a 24% premium to Thomas & Betts’ closing stock price on Jan. 27 and a 35% premium to the volume weighted average stock price over the past 60 trading days. The transaction is subject to approval by Thomas & Betts shareholders as well as to customary regulatory approvals, and is expected to close by the middle of 2012.

The shares closed at $20.55, down $0.69, or 3.25%, on the day. Its market capitalization is $47.07 billion.

Koninklijke Philips (NYSE:PHG): “We are cautious about 2012 given the uncertainty in the global economy, and Europe in particular,” says Philips (NYSE:PHG) CEO Frans van Houten, reports Reuters. The company reiterated previously announced restructuring measures, including 4,500 job cuts.

The shares closed at $20.03, down $0.34, or 1.67%, on the day. Its market capitalization is $18.83 billion.

Siemens AG (NYSE:SI) has entered into an agreement with RuggedCom to acquire all of the issued and outstanding common shares of RuggedCom by way of a friendly, board-supported takeover bid. The takeover bid is for C$33.00 per common share in cash, or a total transaction value of approximately C$382M. RuggedCom’s Board of Directors has unanimously determined to support, and to recommend that RuggedCom’s shareholders accept the offer. Subject to the satisfaction or waiver of certain limited conditions, Siemens expects to take up shares under the offer in the second half of March. The Siemens offer will be made through a wholly-owned subsidiary and is expected to be mailed in early February.

The shares closed at $94.74, down $1.37, or 1.43%, on the day. Its market capitalization is $83.02 billion.

Raytheon Company (NYSE:RTN) has been awarded a $10M contract from Naval Sea Systems Command to develop a pulsed power system that will enable projectiles to reach great distances without the use of an explosive charge or rocket motor. The contract for the preliminary design of a Pulse Forming Network, or PFN, is part of a larger effort by the U.S. Navy to develop a multimission weapon system for use on naval warships to defend and attack with pinpoint accuracy. Under the contract, Raytheon will provide the research and development of an advanced Integrated Power Systems power load module that may be used for PFNs to power future lasers, railguns or radars.

The shares closed at $48.00, down $0.64, or 1.32%, on the day. Its market capitalization is $16.61 billion.

General Electric Company (NYSE:GE) Oil & Gas announced new projects worldwide totaling nearly $1.3B in equipment and service contracts. Under contracts totaling nearly $1B, GE will supply a wide range of equipment and services for the Ichthys LNG project in Western Australia, being developed by INPEX Corporation and Total. GE subsea production equipment, control systems and services have been selected for the Nexen Golden Eagle Area Development project in the United Kingdom’s central North Sea. GE Oil & Gas will supply associated gas utilization technology for TNK-BP’s Verkhnechonsk oil and gas field in Eastern Siberia. GE has been selected to provide key equipment for a floating oil production, storage and offloading platform being built to develop the Guar Norte section of the Tupi oilfield in Brazil’s Santos oil basin.

The shares closed at $18.90, down $0.13, or 0.68%, on the day. Its market capitalization is $199.53 billion.

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To contact the reporter on this story: Stella Mariz at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com