A March 20, 2006 report published by Standard & Poor’s Ratings Services is titled “Strong Funding Levels Keep U.S. Defense Contractors Prosperous,” and cites the recent Quadrennial Defense Review (QDR) and President Bush’s FY 2007 defense budget request. Standard & Poor’s credit analyst Christopher DeNicolo says:
“Defense budgets have risen significantly since the late 1990s and, although growth is likely to slow after 2007, the total level of funding is still significant… Higher revenues, earnings, and cash flows, coupled with divestitures of noncore assets, have allowed companies to reduce debt, pursue targeted strategic acquisitions, or return cash to shareholders through moderate share repurchase programs and increased dividends in recent years.”
While the report is subscriber-only on the S&P site, Defense-Aerospace has a few additional details in a carried release.