Legal Commentary

Scanning Companies See Stock Rise After Xmas Day Attack

By Jeralyn

OSI Systems, which owns Rapiscan, which makes the Rapiscan WaveScan 200 I described here, just got a new 10 year contract with Puerto Rico for its cargo imaging system, called the Rapid Eagle. But Puerto Rico says it's not for terrorism, but crime, including tax evasion:

Director of the Puerto Rico Ports Authority, Mr. Alvaro Pilar-Vilagran, stated that "the Puerto Rico Ports Authority is implementing this unprecedented scanning program....The program aims to eliminate the import of drugs, illegal weapons and other contraband into Puerto Rico, while affording the Ports Authority a mechanism to fight tax evasion.

In the last three months, the company's stock has grown 67%, from $17.03 to $29.07. I doubt it's peaked yet. And this is interesting: The company's CEO is Deepak Chopra. According to the company on December 30 (Dow Jones Newswire, subscription, no link): [More...]

The TSA had bought about 150 body-scanning machines from Rapiscan using stimulus funding earlier this year, with deployment originally planned for January. And Kant said Monday he believes more machines will likely be ordered following Friday's failed attack.

The other companies that are seeing a stock surge from scanning equipment: American Science & Engineering Inc (ASEI), ICx Technologies Inc. (ICXT). Also to watch: L-3 Communications Corp. (LLL).

Jim Cramer likes:

FLIR Systems (NASDAQ: FLIR) noted for its night vision technology; Cogent (NASDAQ: COGT) has solid fingerprint recognition technology; and L-1 Identity Systems (NYSE: ID) mentioned for its proprietary technologies.

Update: In case someone reads this who isn't aware that TalkLeft is not a financial site, I should make it clear I know absolutely nothing about the stock market or Jim Cramer. I just thought the dots between the equipment companies and their stock prices possibly worth connecting.

Full post as published by TalkLeft on January 07, 2010 (boomark / email).