ST Engineering is down 1.7% at $3.55, but the decline likely isn’t related to the announcement its electronics arm secured $166 million of rail-electronics and satellite-communications contracts in 3Q12.
“The stock has been performing extremely well the past couple weeks,” an analyst notes. STE’s intraday high of $3.62 is its highest since February 2008. While the electronics orders for 3Q12 are lower than 2Q12’s $210 million of electronics orders, the orderbook remains strong around $12 billion and the aerospace orders haven’t yet been announced, she notes.
She adds, the announcement shows STE is getting overseas rail contracts; with China set to begin rail spending, “they will be in an advantageous position to secure more rail-line metro contracts.” She notes the dividend yield remains strong around 5%.
Orderbook quotes suggest support at the 10-day moving average at $3.42 is unlikely to be troubled.
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