Look for Alliant Techsystems to lift-off like its engines

With the U.S. economic landscape remaining uncertain, it's prudent to add a defensive stock or two to your portfolio, and with the aforementioned in mind Alliant Techsystems is worth an evaluation.

Alliant Techsystems (NYSE: ATK) is an ammunition supplier and rocket engine / motor manufacturer with substantial United States Government contracts.

Analysts like Alliant's strong fundamentals, solid U.S. Department of Defense orders for ammunition, equally impressive launch systems work from NASA, and sporting ammunition business.

Analysts also believe ATK is well-positioned to capture a portion of the U.S. DOD's work for next-generation weapon systems.

Meanwhile, margins should improve slightly in F2008 to 11%, and costs, while not low, are reasonable. The Reuters F2008/F2009 EPS consensus estimates for ATK are $6.39/$7.38.

The risks? An early withdrawal of U.S troops from Iraq would lower ATK's revenue for F2009-F2010. Analysts are also keeping an eye on the company's productivity per man hour.

The First Call mean rating for ATK is: Buy. [12 firms.] Mean 2008 target: $128. [high: $136, low: $120.]

Stock Analysis: Alliant Techsystems is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 2 years should be rewarded from ATK's shares. Sell / Stop Loss if you were to purchase shares in this company: $68.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.