This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

How Ceradyne's 'Bull' Trampled Expectations

All told, in its bid to the government, Ceradyne has offered to supply some 41,000 Bulls valued at more than $50 billion. After giving its partners their share, Ceradyne would take home roughly half of that amount.

For comparison's sake, at current revenue-generation rates, Ceradyne would need more than three decades to bring in that kind of money.

To be sure, the U.S. military has no plans to spend that much on MRAPs right now. After all, experts estimate, the military ordered only 12,000 of the vehicles -- worth about $7.2 billion -- when violence in Iraq was at its peak last year. The military has since backed away from its aggressive push for more of the vehicles, signaling a likely end to at least the original MRAP program.

Still, MRAP II promises another major opportunity. This year, experts predict, the military could order about 3,000 of the next-generation vehicles under an MRAP II program that boasts some $12.5 billion in earmarked funding.

Without any Bull orders, Ceradyne expects to deliver minor growth this year, with sales of $780 million and earnings of $5.60 a share. With just a 550-Bull order, however, those numbers should jump by 37% and 19%, respectively, as the company hits the high end of its range.

"In the 40 years since I was involved in the founding of Ceradyne in August of 1967," CEO Joel Moskowitz told investors last October, "the company has never had a program as exciting -- and with the financial potential as large as -- our involvement with what we've now called the Bull."

'Team Bull'

Ceradyne can thank Ideal Innovations, better known as I3, for its opportunity.

During multiple visits to Iraq, I3 President Robert Kocher observed a threat posed by EFPs -- the most devastating of roadside bombs -- that could overcome the protection offered by even sturdy MRAP vehicles. When the Marines called for a solution in 2005, Kocher relied on his deep military and technological experience to seek an answer. He found one and soon patented it, then set off in search of a partner.
2 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
FRPT $8.28 0.00%
OSK $48.85 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%
GOOG $693.01 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs