Summary Huntington Ingalls Industries' 15% and ~21% of revenues in 2021 and Q1 2022, respectively were non-shipbuilding. Technical Solutions, renamed Mission Technologies, has six diverse non-shipbuilding business groups. Mission Technologies could be 25% of total revenues in 2022 or 2023. Investment Thesis:

I have written nine previous Seeking Alpha articles about Huntington Ingalls Industries (NYSE:HII) and remain positive on the company. HII is the nation’s largest military shipbuilder. Building nuclear aircraft carriers and nuclear submarines is a complex and long-term program. As such the financial statements may be somewhat “lumpy”, that is, the finances do not always result in smooth, rapid growth that may be evident like in a fast growth software company. But HII is a premier national defense business.

The one-year stock does have its ups and downs.

HII will not be a 5 or 10 bagger, however, it can be classified as a great, steady value stock. The current forward P/E is 14. The dividend yield is 2.25%. The 5-year dividend CAGR is a fine 16.98%. There are a number of key reasons to consider HII if one is a value investor. HII is a business and a stock focused on the long term. It’s a value stock. Management expected a 3% revenue growth – “thus steady as she goes.” This article will look at a portion of the environment going forward. We’ll summarize and drill down on key attributes.

Management has a strategy of broadening the company through organic businesses and acquisitions that are not directly tied to large shipbuilding for the US Navy and Coast Guard. As such HII is setting in place a government business extending beyond shipbuilding.

Why buy HII:

Backlog: A large and increasing backlog.

The backlog of $48.5 Billion is the busiest the shipyards have been since it was spun out of Northrop Grumman (NOC) in 2011.

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