L-3 Communications Holdings, Inc. (NYSE:LLL)
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The Company is a prime system contractor in aircraft modernization and maintenance, Command, Control, Communications, Intelligence, Surveillance and Reconnaissance systems and government services. Also supplies high technology products and systems.
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Based upon historical earnings, I think this stock should be valued near $105.59 using discounted cash flows over the next 5 years. This produces a safety margin of 36%. Besides the earnings growth indicating the stock is under valued, this stock is due to have a spin-off next year which I believe will produce more value for shareholders. The only downside that I see is the pending defense cuts over the next year or so, but I believe this is a good long-term investment.