Executive Mosaic’s GovCon Index closed in narrow range Thursday to start the final month of 2016 as sharp declines by government services contractors offset large gains for aerospace stocks in a session that saw U.S. stocks close mixed.
GovCon Index decliners outnumbered advancers by a 2-to-1 ratio and five of its 11 S&P 500 stocks registered gains with Textron (NYSE: TXT) the top net performer among companies listed in both indices.
Five GCI components added at least $1.00 each and four posted losses greater than that benchmark.
Rockwell Collins (NYSE: COL) led all GCI net gainers and hit a new 52-week high during the session after Bloomberg reported post-close Wednesday an activist investor is attempting to pressure the avionics company to reconsider its $6.4 billion acquisition of B/E Aerospace (Nasdaq: BEAV).
Starboard Value LP and three other top 25 shareholders of Rockwell Collins plan to reject the purchase and instead push for a sale of the Cedar Rapids, Iowa-based company, according to the report by Ed Hammond and Julie Johnsson.
Volume for Rockwell Collins totaled 4.13 million shares versus the three-month average of 1.3 million.
B/E Aerospace’s stock fell 1.7 percent to $59.02 Thursday but has traded up 16.62 percent since the deal’s Oct. 23 announcement.
GovCon Index-S&P 500 stocks Textron and Boeing (NYSE: BA) finished second and third respectively for GCI net gainers, followed by fellow aerospace and defense companies Lockheed Martin (NYSE: LMT) and General Dynamics (NYSE: GD).
Textron reached a new 52-week high Thursday along with General Dynamics, L-3 Communications (NYSE: LLL) and Navistar International (NYSE: NAV).
Booz Allen Hamilton (NYSE: BAH) closed as the GCI’s lowest percentage performer and fifth-worst net laggard after Carlyle Group disclosed plans to sell the remainder of the equity firm’s stake in the McLean, Virginia-based government services contractor.
Carlyle acquired Booz Allen in 2008 and took the contractor public in 2010.
Science Applications International Corp. (NYSE: SAIC) weighed as the GCI’s largest net decliner Thursday and is down 4.36 percent over two sessions since Citi lowered its rating on the government services contractor to “Neutral” from “Buy” with a price target lift to $86 from $79.
Citigroup cited the stock’s strong November performance at a 19.82 percent gain and overhang from a pending contract transition behind the downgrade.
Other services-oriented companies among the lowest five net movers include CACI International (NYSE: CACI), ManTech International (Nasdaq: MANT) and Maximus (NYSE: MMS).
Six S&P 500 sectors declined with information technology the worst performer with financials the top gainer among the remaining five as investors looked ahead to Friday’s jobs report.
Futures markets have the odds of an interest rate hike at 99 percent for the Federal Reserve‘s next meeting Dec. 13-14, CNBC reported.
Market Summary
| Index | Value | Net Change | % Change |
|---|---|---|---|
| GovCon Index | 89.417 | +0.094 | +0.072% |
| S&P 500 | 2, 191.07 | -7.73 | -0.35% |
| Dow Jones Industrial Average | 19, 191.93 | +68.35 | +0.36% |
| NASDAQ | 5, 251.11 | -72.57 | -1.36% |
| Advancing GovCon Index Issues | 13 |
| Declining GovCon Index Issues | 16 |
| Unchanged GovCon Index Issues | 1 |
Top GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –´ | % Change |
|---|---|---|---|---|
| COL | Rockwell Collins | 96.07 | +3.35 | +3.61% |
| TXT | Textron * | 47.88 | +1.85 | +4.02% |
| BA | Boeing * | 152.39 | +1.83 | +1.22% |
| LMT | Lockheed Martin * | 266.40 | +1.15 | +0.43% |
| GD | General Dynamics * | 176.40 | +1.05 | +0.60% |
Top GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –´ |
|---|---|---|---|---|
| TXT | Textron * | 47.88 | +1.85 | +4.02% |
| COL | Rockwell Collins | 96.07 | +3.35 | +3.61% |
| KBR | KBR | 16.94 | +0.23 | +1.38% |
| BA | Boeing * | 152.39 | +1.83 | +1.22% |
| ACM | AECOM | 36.67 | +0.32 | +0.88% |
Lowest GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –¾ | % Change |
|---|---|---|---|---|
| SAIC | SAIC | 80.70 | -1.87 | -2.26% |
| CACI | CACI International | 128.25 | -1.15 | -0.89% |
| MANT | ManTech International | 41.90 | -1.11 | -2.58% |
| MMS | Maximus | 54.25 | -1.04 | -1.88% |
| BAH | Booz Allen Hamilton | 36.85 | -0.96 | -2.54% |
Lowest GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –¾ |
|---|---|---|---|---|
| MANT | ManTech International | 41.90 | -1.11 | -2.58% |
| BAH | Booz Allen Hamilton | 36.85 | -0.96 | -2.54% |
| SAIC | SAIC | 80.70 | -1.87 | -2.26% |
| MMS | Maximus | 54.25 | -1.04 | -1.88% |
| EGL | Engility Holdings | 35.70 | -0.55 | -1.52% |
