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It was a strong month for the Global Security Fund, which was up 3.3 percent and 3.4 percent for the R and S share classes, respectively. Cyber security companies benefited from increased investment focus on the industry following another high-profile cyber attack. This time it was the Kaseya attack that affected COOP and many other companies around the world.
Cyber security company Fortinet continues to perform and reported better than expected results for the quarter. The pace of investment in the cybersecurity segment by companies seeking protection against cybercrime has benefited the company, which reported that business orders have seen a marked increase. The stock rose 14.8 percent for the month with a contribution of 0.75 percent.
Kongsberg Gruppen released a strong report that beat the market's expectations. The company continues to impress within the various departments. Within Defense & Aerospace, the company delivered an EBITDA of 21 percent with revenue for the quarter that was 22 percent higher than the year before. Within the Maritime business area, the company sees a significant increase in new orders, while Digital has signed a number of new orders to existing customers as new. The company's management is extremely positive about future developments. The stock was up 11.8 percent for the month with a contribution of 0.65 percent. The fund increased its holding in the company in July.
Saab was up 15.1 percent after a stronger report and results than expected. The company has been in a difficult position during the covid pandemic, but now sees a recovery in the sector and with more orders than expected, the company has also upgraded the expected annual result. The company has for a long period lagged behind the other defense companies and the price development of the share price reflects investors' dissatisfaction, but the future looks brighter. The company delivered its second unit to the school aircraft flight test program on July 24 and after the engineering and manufacturing phase is completed, production for the project will move to the company's facility in Indiana, USA. The company also received a large order from the German Navy in connection with a modernization of the country's F123 Frigates. The company's share price rise provided a contribution of 0.41 percent.
Technology company Teledyne Technologies reported better than expected sales and better adjusted earnings per share and also upgraded the company's expectations for the year's results. The demand for drones and robots is increasing and the company's niche within this segment supports a higher share price. The company was up 8.6 percent with a contribution of 0.38 percent.
L3 Harris Technologies reporting next month was up 5.4 percent for the month with a contribution of 0.34 percent. The company has a niche in surveillance systems and confirmed that the company has won a contract with NATO to develop their air warning system.
Cyber security company NortonLifeLock was down 8.4 percent for the month with a contribution of 0.3 percent. The company reported a slightly better-than-expected result but was met with negative reactions to the news that the company is interested in a merger with Avast – a London-listed Czech company that offers a so-called 'freemium' model where customers get basic packages for free but buy more advanced services . So far no agreement has been reached and NortonLifeLock has until August 11th to make a bid for Avast.
Boeing reported better-than-expected sales and delivered a positive report showing an increase in deliveries of 737 aircraft. Great uncertainty surrounding the recovery of the aviation industry has kept the price down and it will take time before the share recovers to previous valuation levels. The company was down 4.9 percent during the month with a contribution of 0.1 percent.
Lockheed Martin delivered as expected with slightly better sales and slightly worse earnings per share. The fact that the production of the F-35 fighter aircraft is lagging behind is like a wet blanket over the company's share price, but the focus should be on the company's growth in space and hypersonic development. Considered a premium security services provider, the company is a highly successful company that also has free cash flow of over $7 billion. The company was down 1.3 percent with a contribution of 0.1 percent.
Marine company and aircraft carrier maker Huntington Ingalls Industries reports next month but was down 2.2 percent with a 0.1 percent contribution. The company reported on July 7 that it will buy Alion Sciences and Technology Corporation for $1.65 billion in a cash transaction that will be financed by bonds. Alion has a long history in the security industry in AI, cyber security and electronic warfare. Huntington announces that the purchase will benefit the Technical Services Division - a strategic area for the company.