General Dynamics, Harris, L-3 Gain Most From Iraq War - No recession for war profiteers

http://www.bloomberg.com/apps/news?pid=20601103&sid=agA5ID.LQxb8&refer=us

March 25 (Bloomberg) -- General Dynamics Corp., Harris Corp. and L-3 Communications Holdings Inc. benefited most among the Pentagon's 25 largest military suppliers from five years of conflict in Iraq, based on a combination of war-related sales and stock gains.

General Dynamics and Harris, the Melbourne, Florida-based maker of combat radios, both tripled in stock price in the five years ended March 20, the anniversary of the war's start. L-3, which provides translators, rose 164 percent. Their gains beat the Standard & Poor's 500 Stock Index, which rose 52 percent, and the S&P Aerospace and Defense Index, which more than doubled.

The U.S. has begun reducing troops in Iraq, a process that may accelerate next year and threaten revenue of companies that gained the most from the war. Heavy combat use of vehicles and equipment still will trigger years of replacement sales. War costs are about $12 billion a month, the Pentagon said Jan. 28.

``The war has been a huge benefit to almost all contractors,'' said William Hartung, director of the arms and security initiative at the New America Foundation in New York. ``Ammunition, armor, vehicles, communications are places where there's a lot of spending now, and they will have to repair or replace much of it when the war ends.''