"Flir Systems Inc. (NASDAQ: FLIR) provides thermal-imaging and infrared camera equipment for military, law enforcement, and commercial applications," notes Leo Fasciocco.

In his Ticker Tape Digest, which focuses on stocks showing technical breakouts, he explains, "FLIR has convincingly broken out from a five-week base; the move was boosted by the win of a $359 million contract from the Army."

"FLIR, with annual revenues of $855 million, has been a sensational winner since 2001. It is a beneficiary of the war on terror and the need for equipment to combat it via military and security needs.

"Short-term, the daily chart shows the stock crossing its resistance line at 35.54. The move sends the stock over not only near-term resistance but also over the peak made back in early November. The action indicated very astute institutional buying.

The military and security applications of thermal imaging devices that allow users to see in the dark and poor weather are obvious. The potential enhancement of operations in such arenas as navigation safety, vehicle vision, environmental assessment, predictive maintenance and manufacturing control are becoming obvious. A leading provider of a range of application-specific instruments is headquartered in Wilsonville, Oregon.

FLIR Systems (NASDAQ: FLIR) designs and manufactures thermal imaging systems and infrared cameras, for a wide variety of thermography and imaging applications. The devices detect heat, allowing effective operation in darkness, fog and smoke. Clients use them in research and development, manufacturing process control, airborne observation, search and rescue, surveillance, reconnaissance and environmental monitoring. U.S. government agencies account for about one-third of FLIR's sales. Lockheed Martin (NYSE: LMT) is a major competitor.

FLIR pleased investors last week, when it reported Q3 EPS of 45 cents and revenues of $191.1 million. Analysts had been expecting 39 cents and $180.8 million. The firm set quarterly records for orders, backlog, and revenue. Management also guided FY07 EPS to $1.73-$1.78 ($1.69 consensus) and FY07 revenues to $755-$770 million ($749.31M consensus). The board declared a 2-for-1 split for December 10th. The share price popped on the news and then moved into a bullish "pennant" consolidation pattern. Stocks frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with three "strong buys," three "buys," nine "holds" and a "sell." Analysts expect a 21% growth rate through the next year. The FLIR Sales Growth rate (43.47%), Operating Margin (25.47%), Net Profit Margin (17.97%), Return on Assets (15.53%) and Return on Investment (18.88%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 600 SmallCap Index. Over the past 52 weeks, it has traded between $29.62 and $72.70. A stop-loss of $60.75 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

My recent Investing in Oregon post took a look at some companies that the Motley Fool had featured in its investigation of investment opportunities in the Beaver State, including Precision Castparts Corp. (NYSE: PCP), StanCorp Financial Group Inc. (NYSE: SFG), FLIR Systems Inc. (NASDAQ: FLIR), and Columbia Sportswear Co. (NASDAQ: COLM).

But the Motley Fool article also mentioned that one of the most prominent business influences in Oregon wasn't even headquartered in the state: semiconductor giant Intel Corp. (NASDAQ: INTC) from Santa Clara, California. It also included mention of four Oregon-based businesses that provided support for Intel: Tektronix Inc. (NYSE: TEK), Mentor Graphics Corp. (NASDAQ: MENT), Triquint Semiconductor Inc. (NASDAQ: TQNT), and Electro Scientific Industries Inc. (NASDAQ: ESIO). One could imagine that Intel's impressive earnings report this week should have been good news for these supporting companies.

Beaverton-based Tektronix, widely known as Tek, is one of the leading makers of test and measurement equipment, such as digital multimeters, logic analyzers, and curve tracers, and oscilloscopes. Tek will win its seventh technical Emmy this year. Tek beat Wall Street expectations in its previous three quarters, reporting earnings per share of 40 cents for its first quarter FY2008. But the consensus of analysts surveyed by Thomson Financial was to hold shares of Tek. The share price reached a 52-week high of $37.95 on Monday when it was announced that Danaher Corp. (NYSE: DHR) will acquire Tek. Tool and equipment maker Danaher just announced record third quarter results.

"The recent market volatility has shaken more than a few traders, leaving them wondering where they should turn next to protect themselves," notes Jocelynn Drake.

But one sector, she notes, that has performed well and should continue to do so, is the defense sector. In particular, the analyst with Schaeffer's Investment Research considers L-3 Communications (NYSE: LLL) and FLIR Systems (NASDAQ: FLIR) as "shining gems."

Drake notes, "Topping the list is L-3 Communications, which makes secure and specialized systems for satellite, avionics, and marine communications such as flight recorders (black boxes), display systems, and wireless telecom gear."

On July 26, she notes, the company reported a second-quarter profit of $1.49 per share, beating the consensus estimate by a nickel. Revenue for the quarter jumped 11% to 3.41 billion. Adding to its good news, she notes, was that L-3 boosted its 2007 earnings outlook.