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What's Next for Northrop?

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Defense stalwart Northrop Grumman (NYSE: NOC  ) confirmed this week that it will relocate its headquarters from the City of Angels to the City of Beltway Bandits. An appropriate move, methinks, and here's another: Northrop's next move should be to change its stock ticker from "NOC" to "UAV."

Why, you ask?
Because while it's true that when the Pentagon wants to buy a new unmanned aerial vehicle (UAV), former General Dynamics (NYSE: GD  ) division General Atomics remains their go-to guy, for small investors like you and me, Northrop seems to be fast overtaking GA as the one-stop stock for investing in robotic airplanes.

Sure, historically, Boeing (NYSE: BA  ) and Textron (NYSE: TXT  ) are the two publicly traded companies that have garnered the bulk of press attention in this space. Boeing's the company that made the ScanEagle that helped rescue the Maersk Alabama captain last year. Textron's Shadow UAV has been winning acclaim in Iraq. There's also Lockheed Martin and its Desert Hawk, and moving down the size-scale, Honeywell's (NYSE: HON  ) T-Hawk and AeroVironment's (Nasdaq: AVAV  ) Raven to contend with. But for the most part, Pentagon weapons buyers still seem to favor "big" UAVs like GA's Predator. And the biggest publicly traded contender in this arena, it seems to me, is Northrop and its Global Hawk.

How can you tell the Global Hawk is succeeding? Well, there are the company's periodic press releases for one thing. Mid-last year, Northrop confirmed that its bird had already flown 31,000 hours in U.S. service -- and that number's likely to have gone up since. A few months later, we learned that Global Hawk has gone international, when Northrop announced that both it, and partner Raytheon (NYSE: RTN  ) , would be sharing in $2.2 billion worth of European loot as NATO agreed to purchase eight new Global Hawks.

All of this is resulting in increasing profitability for Northrop's Aerospace business, as well. While the beleaguered Shipbuilding biz grabbed headlines yesterday for biggest gains in revenues and profits, Aerospace grew its sales 10%, and its profits even faster -- up 15% year over year. Taken together, this suggests that UAVs are fast becoming a big revenue driver for Northrop, and an even bigger profits generator.

Foolish takeaway
Between its Global Hawk, Fire Scout robotic helicopter, and "Bat" flying wing, this company is fast becoming the go-to UAV-maker for Foolish investors. Time to change the ticker, Northrop.

Is there such a thing as a growth stock selling for an attractive price? There is. There are. They're here.

General Dynamics is a Motley Fool Inside Value selection. AeroVironment is a Motley Fool Rule Breakers recommendation, and also, Fool contributor Rich Smith owns shares of AeroVironment. The Motley Fool has a disclosure policy.

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