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TheStreet Open House

5 Homeland Security Stocks That Make Safe Buys

Stock quotes in this article: FLIR, ASEI, IDSY, CACI, AVAV

CACI International

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The reliance of the global economy on information technology, including the Internet and wireless networks, makes for prime terror targets. Cyber security is an absolute must as more and more trade takes place over the Internet. Hackers have the ability to disrupt power services, air travel and the banking system from the comfort of computers located far from any law enforcement or military presence.

CACI International (CACI) provides IT services to the federal government and commercial customers in the U.S. and internationally. In addition to helping set up command and control for military missions, the company provides cyber security against potential threats to any number of networks and systems that may be vulnerable to attack.

Shares of this $1.6 billion market cap company have been hit hard by concerns regarding the federal debt and budget deficit. Politicians cutting spending here, though, would be making a big mistake and opening the door to any terrorist ready to find the one opening that could cripple our way of life. Since the beginning of July, shares are down 17%.

Considering the company has beaten average Wall Street estimates in each of the last four quarters, I would use the discount as an opportunity to buy. Trading for just 10 times estimates for the fiscal year 2012 ending June 30, CACI shares are cheap in my opinion.

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