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Sequestration Watch: Boeing and Lockheed

Stocks in this article: BA LMT WDAY ULTI SQI

Parenthetically, I might add that tweets I received from a few Lockheed employees following my broadcast on Saturday said that Bloomberg reporter Capaccio was right on. One noted, that if furloughed, it would likely be for a day a week initially. Further he said that on his days off he would probably work at home anyway so as not to be overloaded on the other four days he was working. I would note that in a sense, this is a win for the government, since in situations such as this they would be getting free labor.

Now for the bad news, or as some might say, the really bad news. Warmer convention cities, as well as information technology contractors are likely to feel the pinch from sequestration much sooner than others. "The GSA conference scandal which came to light last summer struck a chord, and I am seeing memos cutting back on conferences to places like San Diego and New Orleans," said Capaccio.

I would add as we go into the summer conference season, this could also translate into slack business conditions in cities across the country, not just in warmer areas.

Though IT consultants are vulnerable, Capaccio suggested that companies which provide services or software that combine operations or help create efficiencies might be able to win. "You might find bases across the country looking for humane ways to cut back on personnel and they may want services to help these people make a transition."

By the way, here are three companies that match that profile. I don't own any of them and am not recommending them either, but rather suggesting they are engaged in a line of business that is interesting given the advent of sequestration.

Workday (WDAY) offers cloud-based applications to manage human capital and financial resources.

Ultimate Software (ULTI) offers human resources management software.

SciQuest (SQI) offers cloud-based procurement management.

At the time of publication the author held no positions in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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