Show BUSINESS I ind thi I AEROSPACE AC CONTRACTORS S FIU FORESEE FURTHER GAINS Buoyed by strong military outlays the aerospace Industry is looking forward to finishing up 1977 on a strong upbeat and achieving new records in 1978 Although export sales have moderated from the fast and furious pace of the last few years they should forge ahead for the 79 1977 period Look too for revitalized commercial orders in the interim enhancing enhancing cing the total profits picture The Thc Research Department of Babson's Reports considers the near to term intermediate term outlook for selected aerospace companies as good making for additional worthwhile market gains There are however still enough uncertainties in this highly volatile field to warrant advising caution with a few of the companies DEFENSE DEFENSE FIRMS WELL POSITIONED Despite the reshuffling and cancellation of some contracts the military manufacturers are riding the crest of aerospace spending This sector is in fact anticipating sales of billion for 1977 up from 99 billion the year before In 1978 some billion is targeted Missile orders in particular are expected to advance markedly The cancellation of the controversial controversial controversial con con- B l bomber and full- full speed go ahead on ah ahead ad on the Cruise Missile should just about enable the industry to maintain its projected spending As the defense budget stands at the present time outlays for forthe forthe forthe the fiscal year beginning October October October Oc Oc- Oc- Oc tober 1 1977 for fiscal 1978 are forecast at close to billion up from 98 billion for fiscal 1077 and the 88 billion of fiscal 1976 With fewer funds allegedly required for the Cruise Missile than for the recently canceled l B the final figure could vary somewhat But it appears that strong military spending will be bea a keynote in the upcoming fisc fiscal l year ah f. f r r ll COl ANn AND CIVIL AIRCRAFT Domestic air traffic growth is improving and industry experts experts experts ex ex- ex- ex foresee 1978 as the year when orders will be coming in at a good rate There was some betterment this year but the airlines were still taking the time to reassess their ordering plans and to line up financing with projected air traffic growth S. Private plane makers are enjoying another twelvemonth of healthy growth and are scoring further record ad ad- vances New models and advanced advanced advanced ad ad- export sales have been pacing the significant gains But as for the advance in space outlays this was aided principally principally principally prin prin- by one the program-the space shuttle The manufacturers of commercial jet planes are optimistic that the 3 billion sales level predicted for this year as a whole will prove to be bethe bethe bethe the out bottom-out point and that shipments could rebound to over 6 billion by 1982 Sales of civilian planes are estimated at 1 14 4 billion for 1977 and 17 billion for 1978 up from 12 billion in 1976 Space sales should be 34 36 6 billion SEI SELECTED ETED INVESTMENTS ADVISED n nIn In recognition of the improving improving improving im im- im- im proving near to intermediate intermediate- term prospects for certain segments of the aerospace industry the Research Department of Babson's Reports at this time recommends recommends recommends mends for purchase the com corn cornmon common common mon stock and the Cum Cv Pfd rfd stock of Lear as asan asan asan an interesting speculation The latter is suggested particularly for investors desiring a higher yield Lear already widely diversified continues to seek out out any worthwhile mergers Viewing the industry as a whole we fee feel that the securities of all the aerospace pace contractors with the exception of Lockheed and McDonnell Douglas continue to warrant our hold advice In our opinion the two wo exceptions mentioned here appear to be considerably less favorably positioned For or those investors who would like some stock coverage in the aerospace industry a detailed buy story on Lear Jear may be obtained free of charge by writing to Babson's Reports Inc Wellesley ley Hill Massachusetts |