In his classic Fool Commentary "Press Release Bingo," fellow Fool Tim Beyers described how perhaps 95% of all electronically posted press releases aren't worth the paper they're not printed on. They're fluff, and they tell you a whole lot less about a company, and its worth, than they purport to. But on a rare occasion, you'll come across a press release that's not just worth reading -- it's worth reading between the lines. That was the case with yesterday's announcement by General Dynamics (NYSE: GD ) .
On Tuesday, General D confirmed that after four months of field testing on its Land Warrior system, conducted last year at Fort Benning, Ga., the U.S. Army is awarding the company a $30 million contract for "as many as 500 Land Warrior ensembles and Stryker Integration Kits into a Stryker experimental battalion."
That's news to which the average investor might forgivably reply: "So what? General D makes $19.2 billion in sales every year, so a $30 million contract is hardly even worth mentioning." But I'd beg to differ. As I've said before, I believe that General Dynamics, of all the nation's defense contractors -- including such competitors as Northrop Grumman (NYSE: NOC ) , BAE Systems PLC (AMEX: BAE ) , and Lockheed Martin (NYSE: LMT ) -- has the best grasp of where the future of military hardware is headed. The company's emphasis on Land Warrior, which at first glance appears to be a relatively piddling program, provides further evidence of the company's forward thinking.
To see why, you need only read two lines from the company's press release: "Land Warrior is an integrated, modular fighting system that uses technology to enhance individual soldiers' close-combat tactical awareness, lethality, and survivability. It includes weapon-mounted sensors, an integrated helmet assembly, a communications-navigation computer system, and software for friendly-force tracking and command/control programs." Essentially, this program will turn individual soldiers into the 21st-century equivalent of Robert A. Heinlein's 23rd-century Starship Troopers. Once deployed, Land Warrior aims to help dismounted soldiers fight smarter, safer, more effectively, and in close coordination with armored vehicles. (It's that last point that explains why the contract involves dismounted soldiers operating in coordination with the wheeled Stryker armored vehicles that carry them into combat.)
As good as the program looks for U.S. war-fighters, it looks even better for investors in General D. Although the pilot program will cover just 500 soldiers initially, there are more than 1 million soldiers currently serving in the U.S. Army, National Guard, and Army Reserves -- and that's not even considering the likely deployment of Land Warrior within the other military branches. This is a program with enormous potential for the company, and investors in this sector would be well advised to monitor developments in the Land Warrior project.
What other cool gadgets is the U.S. military investing in, and how can you invest in the companies that make them? Read on and find out in:
Fool contributor Rich Smith holds no position in any of the companies mentioned in this article.