FRPT

[la-onda]

applaud for all the updates Terry 

[TerryG]

Does not sound like bad news. But I wonder if it is going to change anything?

From the Wall Street Journal

Britain's BAE Is Set to Acquire Armor Holdings

BY DENNIS K. BERMAN AND JONATHAN KARP
Word Count: 585  |  Companies Featured in This Article: BAE Systems, Armor Holdings, Force Protection, Lockheed Martin, General Dynamics

British defense contractor BAE Systems PLC was last night in final negotiations for the $3.5 billion purchase of Armor Holdings Inc., a U.S. maker of military and heavy vehicles, Humvee armaments and soldier body armor.

Final preparations were being made last night, and it was still possible the transaction could fall apart, people familiar with the transaction said yesterday. The deal would award Armor shareholders about $88 a share, or a roughly 7% premium to the company's trading price Friday of $82.15 a share on the New York Stock Exchange. Armor shares climbed markedly late last week from its Wednesday ...

[TerryG]

Hoping news from the Q1 report would save us...............has been delayed.

Form NT 10-Q

FORCE PROTECTION INC - FRPT

Filed: May 09, 2007 (period: March 31, 2007)

Notification that form type 10-Q will be submitted late

[la-onda]

FRPT: Shares Trading Higher on Expected Army Orders
Thursday , May 10, 2007 10:58ET

Force Protection Inc (FRPT) shares, up 9%, are spiking following a CE Unterberg report highlighting a story in the Army Times that noted the Army was expected to ask for $9B for 9 thousand MRAP in 2008 and more money to buy 8.7K in 2009.


&

FRPT: New 52-Wk High @ $25.980 up 11.74%
Thursday , May 10, 2007 10:55ET

This is the 1st 52 WEEK HIGH alert for FRPT in the past 7 calendar days.

The share price for Force Protection, Inc (NASDAQ SC: FRPT) reached a new 52-week high today, trading at $25.980, up $2.730 (11.74%) from its previous close of $23.250.
The Company's previous 52-week high of $24.730 was set 16 days ago on April 24, 2007.
One year ago, the Company's shares closed at $3.500. The price has climbed more than 642 percent since then. At the time of this alert, the stock had traded 958,900 shares via 2,640 trades, 33.25% below it's 20day average of 1,436,595 shares.

This new 52-week high currently puts the stock:

17.12% above its 20day Moving Average of $22.183
34.98% above its 50day Moving Average of $19.247
38.57% above its 100day Moving Average of $18.749

ON FIRE 
cheers

Oliver

[TerryG]

Great news. Could not have anticipated better news.

Thanks for finding it. Was 

[la-onda]

nice chart, nice valuation, nice report 

please download the report

cheers
O.

[TerryG]

Good report. First impressions are that hedging against MRAP fell with JLTV and MMPV. Two major projects they had to bump to fit MRAP. But that is okay.

There is one big issue that is brewing. How to replace all the equipment we are wearing out in Iraq and Afghanistan. The entire budget was based on a peace time military.

So JLTV and MMPV will be back when that issue develops, but that will be after Iraq and Afghanistan.

We will have to wait for Congress, then DoD to get the final numbers. Best news is that there will be a business plan after 2008, into 2009. Which adds to its strategic position and value. Something FRPT was short of. It had no future.

[amstocks82]

Update to one of my FRPT blogs:

The High Cost of Humvees (May 13, 2007)
The HMMWV (High-Mobility Multipurpose Wheeled Vehicle - M1114) is the main utility vehicle used by the US military and allies and is commonly called the Humvee. It was designed to provide tactical mobility to the soldiers. It was not designed as a "fighting vehicle" and unless it is up-armored has very little ballistic or blast protection.

To address the problem of a lack of ballistic and blast protection, most Humvees in Iraq and Afghanistan have been up-armored. Although the additional armor increases the survivability of soldiers riding in the vehicle there are still frequent casualties. Humvees were not designed as armored vehicles and it is not possible to add enough armor to make them truly mine or IED resistant. The Humvee has a flat bottom which means that mines tend to flip the vehicle over and channel energy into the Humvee.

A Humvee normally costs almost $65,000 dollars. An up-armored Humvee cost around $140,000 dollars. Humvees are not designed for the additional weight from the armor. Therefore, the design life of a Humvee that has been up-armored is low -- less than half that of a normal Humvee. In addition, the motor, transmission and drive train were not designed for the additional armor and the vehicle requires more repair. Because up-armored Humvees last less than half as long as normal Humvees and require more maintenance, it is fair to more than double the price tag of the Humvee to $300,000 given that every one that is purchased will need to be replaced very quickly.

Up-armored Humvees are top heavy and roll over more often than Humvees that are not up-armored. Some reports indicate that more than 50 soldiers are killed and over 100 soldiers are wounded each year in Iraq and Afghanistan due to Humvee rollovers. Many of the rollovers would not have occurred if the vehicle were not top heavy due to the additional armor.

When Humvees are destroyed by mines or IEDs, soldiers riding in them are often wounded or killed. The price of losing any life is incalculable. The cost to taxpayers in dollars for these tragedies is huge. Each person wounded or killed needs to be replaced, insurance needs to be paid and the wounded often require long term disability or rehabilitation. The cost is huge. 

The fact that Humvees are easily destroyed means that the vehicles must travel in large groups to provide safety in numbers. This is a very inefficient use of manpower and drastically reduces the area that can be patrolled.

Each time a soldier dies, the morale of civilians and soldiers is harmed and the morale of our enemies is helped. If our enemies are bolstered, this helps them recruit other terrorists.

Using Humvees reduces the militaries efficiency and increases the morale of our enemies by allowing them to have easy victories. These last two costs are more than we can afford.

The US military has recently recognized the problems with the Humvee and with using other un-armored transports in areas where there may be IEDs or mines and have created a new program called the Mine Resistant Ambush Protected (MRAP) program to acquire three categories of MRAP vehicles – CAT I, CAT II and CAT III. The numbers of vehicles needed for the MRAP program keeps increasing. The initial request was for 4100 vehicles and has now risen to over 25,000 vehicles.

There were nine companies bidding on MRAP contracts: Armored Holdings, BAE, Force Dynamics (the joint venture of Force Protection and General Dynamics Inc.), Force Protection Inc, General Dynamics, General Purpose Vehicles, International Military and Government, Oshkosh Truck Corporation, Protected Vehicles, Inc, and Textron. Textron has since been eliminated. The criteria for awarding contracts are:

1) The Contractor or Contractors vehicle systems that demonstrate the best overall performance in PVT testing (with survivability being the highest priority)

2) The Contractor or Contractors that demonstrate the greatest capability to produce and deliver vehicles with the shortest ramp up time and greatest maximum production capacity, in order to meet the urgent delivery requirements for these vehicles

Force Protection's vehicles have proven to be the most survivable in combat. General Dynamics is bidding the RG-31 which has proven to be survivable and BAE has two new vehicles that appear similar to Force Protection Vehicles. Oshkosh, General Purpose Vehicles, Armored Holding and Protected Vehicles have no proven vehicle. Although BAE's new vehicles appear to be designed based on Force Protection's vehicles, they have not been proven in combat.

Purchasing large numbers of effective and proven vehicles for use in Iraq and Afghanistan will reduce the casualties and render IED and mine warfare ineffective. If IEDs and mines are not effective against military targets, then insurgents who wish mainly to kill Americans will have less reason to plant IEDs and mines.

The next step that needs to be taken is to drastically increase tactical maneuverability. Currently, the military must either patrol on foot in large groups, in mine protected vehicles or with large numbers of Humvees such that there are enough Humvees to offer strength in numbers. If Humvees don't patrol in large numbers, then they risk getting ambushed and the patrol wiped out and soldiers captured.

The problem is that there are simply not enough mine protected vehicles such that small numbers of soldiers can patrol in safety and most mine protected vehicles are large. The solution is to purchase a smaller, affordable mine protected vehicle that offers a large amount of ballistic, mine and IED protection but is small enough that small groups of soldiers can patrol in it. This would increase the amount of area that can be patrolled and increase the effectiveness of the soldiers in Iraq and Afghanistan. There would be less reason to deploy more soldiers if the soldiers in Iraq and Afghanistan were more effective.

The Cheetah is another vehicle from Force Protection that can increase the militaries tactical maneuverability and effectiveness. The Cheetah has been under development for over 2 years and has been evaluated by the military. The Cheetah is small enough to be used as a utility vehicle. Its size is comparable to the Humvee but with many times the mine, IED and ballistic protection for the soldiers riding inside. The Cheetah is less expensive than the all current foreign competitor's vehicles and offers more protection than any of the competing vehicles.  The Cheetah is fast – can travel up to 89 miles per hour (burst speed) if needed. Normally configured, it can seat up to six people but can be configured to seat eight if needed. It is possible to mount a remote fired machine gun on the roof and it may be equipped with firing ports. A patrol of two Cheetah vehicles would be difficult to ambush and destroy because of their high degree of ballistic and mine protection. The soldiers inside can fire at their attackers from protected positions inside the vehicle and from the remote fired machine gun. Attackers can't be sure that an IED or mine will disable the Cheetah which will complicate and make most ambushes unworkable.

Vehicles like the Cheetah will allow the military to mount smaller patrols increasing the efficiency of every soldier in Iraq. Patrols will be able to move faster and travel in more dangerous areas. More patrols will be able to be undertaken. The fact that they our soldiers are much more unlikely to be injured or killed by IEDs and mines will be a major boost to the moral of civilians and soldiers. The efforts of our enemies in Iraq and Afghanistan will become much less effective.

Can the military afford to replace a significant number of Humvees with Cheetahs? The answer is that if all direct costs are compared (the cost of injuries, the cost of replacing vehicles, the cost of Humvee up-armor kits and the loss of efficiency), the direct cost of the Cheetah is less than the Humvee.

In war, the major consideration is not just the price but whether or not something will help achieve victory. The Cheetah is a vehicle that if purchased in large quantities for the troops will not only save lives but enable our soldiers to do their jobs in a much more efficient manner.

The main obstacle to deploying large numbers of MRAP vehicles is funding. The military needs funds from Congress. The new democrat leaders in Congress pledged to support the troops. For several weeks, Congress worked on the Defense supplemental bill to fund the troops and new MRAP vehicles. At the same time, Democrat leaders in congress said that they knew that the legislation that they were passing and would get vetoed and planned to pass something different after the veto that the President would sign. In short, the first bill was intended as a political gambit by Congressional leaders. The problem is that soldiers in Iraq and Afghanistan don't have time for gambits – they need the new safer vehicles as soon as possible. They need the funding and the support Congress promised to give them. If companies like Force Protection were to get much larger orders, they could ramp-up more quickly and provide the necessary vehicles quicker and in larger numbers.

[email protected]

[TerryG]

Quarterly report on schedule. Released after close.

http://www.forceprotection.net/investors/sec.html

[TerryG]

Still bullish.

See attachments.

[TerryG]

One more bullish analyst.

Second Opinion® Weekly - FORCE PROTECTION (FRPT)

Close as of week ending
5/11/2007

Moving Average Convergence/Divergence (MACD) indicates a Bullish Trend.

Chart pattern indicates a Strong Upward Trend.

Relative Strength is Bullish.

Up/Down volume pattern indicates that the stock is under Accumulation.

The 50 day Moving Average is rising which is Bullish.

The 200 day Moving Average is rising which is Bullish.

Look for Support at 24.45

Stock broke Double Top (Bullish) Point & Figure Chart Formation Last Week

[la-onda]

Force Protection "buy," target price raised
Wednesday, May 16, 2007 3:19:09 PM ET
Dougherty & Company
NEW YORK, May 16 (newratings.com) - Analysts at Dougherty & Company reiterate their "buy" rating on Force Protection Inc (ticker: FRPT). The target price has been raised from $29 to $32.

&

Military Seeks Bomb-Resistant Vehicle
CBN News
May 17, 2007
CBNNews.com - Insurgents using IEDs, or Improvised Explosive Devices, targeting poorly-armored Humvees have been all-too-common in Iraq.
In fact, these homemade bombs are responsible for 70 percent of the U.S. casualties in Iraq.
That's why the military wants to phase out the Humvee for a mine-resistant ambush protected vehicle -- an "M-RAP" for short -- or simply, a "Cougar."
These are specially designed to withstand explosions.
"I believe I have a moral imperative to provide these vehicles to our troops," said Brig. Gen. Michael Brogan, Commander of the Marine Corps Systems Command. There are only a few hundred Cougars in Iraq now, but they're saving lives. Sgt. David Karr was in a Cougar when he drove over a landmine. "During the explosion, the front of the vehicle probably -- about five feet in the air and it sat back down. But when all was said and done, no one was injured. It was a good day. It was a pretty lucky day," he said. The reason the Cougar is safer is because it's heavier and higher.
And this V-shaped bottom helps displace the blast away from the truck -- and protects the troops inside. "You know, in Iraq, we're on the roads a lot," sad Sgt. Jake Wimer of the U.S. Marines Corps. "And that's when we expose ourselves mostly to IED attacks, is on the road. While you're inside one of these, it's not a problem at all."
So far, there have been hundreds of attacks on marine M-RAPs, and no fatalities. Only two army soldiers have died while in them.
"If we don't get as many of these vehicles as fast as possible, soldiers are going to die unnecessarily," said Loren Thompson, a defense analyst at Lexington Institute.
The military has farmed out contracts to at least nine different defense contractors.
They want to get 7,700 new Cougars and other M-RAPs into the field within 18 months. But after seeing how well these vehicles protect American servicemen, Defense Secretary Gates says the Pentagon could buy many more.


nice video:
http://www.cbn.com/CBNnews/159933.aspx

[TerryG]

Here is more follow up from two sources.


inside defense.com   

16 may 07

Army Eyes $10 Billion in Procurement Cuts to Fund Larger MRAP Fleet 
By Jason Sherman 

The Army is looking to slash as much as $10 billion from its procurement accounts to pay for a larger fleet of Mine Resistant Ambush Protected vehicles, setting off a round of budget drills that could throw its modernization goals into chaos and trigger a wave of program terminations and delays, according to Defense Department officials.

In a bid to find between $8 billion and $10 billion for a down payment on as many as 15,000 additional MRAP vehicles requested by commanders in Iraq, the Army is considering options for financing a sizable portion of the new armored fleet program within its base budget, according to sources familiar with closely held spending deliberations.

"Everything else we had planned is now second priority," said a Pentagon official.
This hunt for new resources is sure to compound Army budget challenges and could test the viability of high-priority projects, such as an effort by Gen. George Casey, the Army chief of staff, to accelerate the service's end strength increase -- an undertaking widely expected to produce a bill requiring billions of additional dollars.

"They are going to break the Army further to fund MRAP," said an industry official familiar with internal budget drills.

Until now, the quick-moving MRAP program was focused on procuring 7,774 vehicles -- 2,500 of which were for the Army -- largely through supplemental appropriations. Because MRAP is not a program of record and was regarded as a requirement unique to needs in Iraq, it was funded outside the service's base budget.

On May 2, however, Defense Secretary Robert Gates designated MRAP the Pentagon's highest priority acquisition program. Gates, in a memo to Pentagon leaders, also implicitly expressed concern that the Army was not buying enough of the vehicles.

"The earlier plan was 2,500 and that's not enough. I can't tell you the exact number at this point, but it's going to grow considerably," Pete Geren, the acting Army secretary, told reporters May 10.

That same day, Army leaders advanced a proposal for increasing its MRAP requirement from 2,500 to more than 8,000 vehicles.  However, officials familiar with the situation say the service faced stiff political pressure to increase its requirement further.

Army leaders are now looking at options for funding the bulk of the more than 17,700 MRAP vehicles that commanders in Iraq, as first reported by InsideDefense.com, have requested inside the service's base budget, a move expected to siphon resources from other programs and delay funding for others. 

"I don't know how the Army does that," the industry official said.

The MRAP budget drills are expected to affect the Army's fiscal year 2009 budget proposal, which is under construction, as well as the FY-08 supplemental spending request and the base budget proposal now before Congress. It may also affect the FY-07 budget, which is being executed.

The size of the bill ultimately depends on how many MRAP vehicles the Army decides to procure each year -- and those purchases may be limited by industry's ability to deliver the new fleet. An internal Pentagon industrial assessment pegs the maximum MRAP procurement rate at 977 a month by the end of this year.

In the hunt for funds to pay for MRAP, Army leaders are expected to fight to protect its top modernization priority, the Future Combat System, from cuts, Pentagon officials said.
Should the Army find funds to buy the entire 17,700 MRAPs now under consideration, the total MRAP program size would more than triple and drive the total price tag to more than $24 billion.


Army seeks $20B for MRAPs, but quick fielding has hurdles

By Tom Vanden Brook, USA TODAY

WASHINGTON — The Army has asked Defense Secretary Robert Gates to approve spending almost $20 billion for new armored vehicles, a week after Gates called deploying the vehicles the military's top hardware priority.

Acting Army Secretary Pete Geren asked Gates for as many as 17,770 mine resistant ambush protected vehicles (MRAPs), according to a memo dated May 15 and obtained by USA TODAY. The vehicles would be shipped to Iraq after production, reaching the goal in July 2009, according to Geren's memo.

Combined with orders by other services, the total cost of the new vehicles through July 2009 will be almost $25 billion, Pentagon records show. The Marines and Navy want 3,500 MRAPs, while the Air Force and special operations units are seeking another 1,000.

However, there may not be enough material and production capacity to field the MRAPs quickly, according to the memo and Pentagon officials.

No single company can provide more than 1,200 of the vehicles per month, which is the Marines' production goal, said Chris Isleib, a Pentagon spokesman.

Adequate supplies of steel for armor and rubber for tires are also concerns, Isleib said.
Loren Thompson, a military analyst at the Lexington Institute, criticized the Pentagon for moving too slowly on the MRAP program.

"By the time we field all the vehicles we could be on our way out of Iraq," Thompson said.
Thompson added, MRAPs may be needed elsewhere.

"Sadly, this vehicle will probably find plenty of uses in other places," Thompson said. "We've shown the world how to fight our army to a standstill."

The Army's rush to buy more MRAPs could affect how many other armored vehicles it buys now and in the future, according to the memo. The Army has sent officials to Iraq to determine how MRAPs will fit in with its existing fleet of armored vehicles, including tanks and armored personnel carriers.

The Army planned to spend $5.5 billion this year on its three main armored vehicles — the Abrams tank and Bradley and Stryker armored personnel carriers — Army budget documents show.

Gates and other Pentagon leaders like the MRAP, because its raised chassis and V-shaped hull of the vehicles help protect troops from roadside bombs, which are also called improvise explosive devices (IEDs). Roadside bombs cause 70% of U.S. casualties in Iraq.
Gates told all services on May 2 to determine how many MRAPs they need. The Army, until the May 15 memo, had sought 2,500 MRAPs. Senior Army officials said commanders in the field valued the maneuverability of the Humvee, the military's longtime workhorse vehicle, saying the MRAPs were often too large and unwieldy.

The number of MRAPs in Geren's memo matches the number of armored Humvees the Army operates in Iraq. The Marine Corps has already announced its intent to replace all its Humvees with MRAPs, saying the new armored vehicles are as much as four times safer.

Eight companies are competing for the contracts to build the vehicles, said Capt. Jeff Landis, a Marine Corps spokesman. The Marines are leading the Pentagon's development of the MRAPs, which are now being tested at the Aberdeen Proving Grounds in Maryland.

Testing should be done by early June, said Brig. Gen. Charles Anderson, the Army's director of force development.

"It's round the clock," Anderson said of the testing. "It shows the sense of urgency."



BETTER PROTECTION

The Pentagon is looking at three types of Mine Resistant Ambush Protected vehicles:

Category 1
Category 2
Category 3





Passengers
6
10
12

Weight
14,000 pounds
38,000 pounds*
45,000 pounds

Wheels
4
up to 6
6

* - Weight for 6-wheel version.
Sources: U.S. Army. Photos from Force Protection Industries, Inc.


Find this article at:
http://www.usatoday.com/news/washington/2007-05-17-army-mrap_N.htm

[la-onda]

new 52 weeks high 

long and strong 

[la-onda]

nice Street.com video:
http://videoplayer.thestreet.com/?clipId=1373_10358557&channel=Market+Strategy&cm_ven=YAHOO&cm_cat=&cm_ite=&puc=yahoo&ts=1179941367109&bt=NS&bp=WIN&bst=FF&biec=false&format=flash&bitrate=300

Conference Link:
Force Protection Inc.
May 24, 2007 - 12:00 PM Eastern
The Robins Group Emerging Opportunities Conference
http://www.vcall.com/IC/CEPage.asp?ID=117099&CID=