The latest data on insider buying and selling continues to show an alarming trend in insider sales and very low buying. Selling for the latest week climbed 10.8% to $933.45MM from $842MM. More alarming, however, is the continuing very low levels of buying. Buying for the latest week fell to $17.35MM from $37.7MM. Despite the 60% rally in stocks and the green shoots of supposed recovery, insiders continue to exhibit very little faith in the future price of their own stocks via the use of the personal dollars.

Notable purchases:

(NOC) Northrop Grumman Bags Navy Contract

Northrop Grumman Corp. (NOC) bagged a $171 million fixed-price contract from the U.S. Navy. The company will provide long lead materials for a continuation in the Aegis-class DDG 51 destroyer program. The funds will be used to purchase long lead time materials and major equipment in support of the new ship, including main propulsion engines, gas turbine generators, propellers and air conditioning systems. The work will be performed at the company's Pascagoula shipyard.
 
The DDG 51 destroyer program was originally awarded to Northrop Grumman in April. The company has delivered 26 of 28 ships, with two more ships currently under construction in Pascagoula.
 
These contracts will boost the dwindling backlog of Northrop, which fell to $71.5 billion after the third quarter of fiscal 2009 from $78.1 billion at year-end 2008. Though Northrop Grumman is one of the largest defense contractors, its backlog was affected by the cancellation of the $5.1 billion Kinetic Energy Interceptor program by the U.S. Government.
 
Northrop Grumman’s future success in the competitive defense industry depends upon its ability to develop and market its defense-related products and services to the U.S. Government, as well as its ability to provide the people, technologies, facilities, equipment and financial capacity needed to deliver those products and services with maximum efficiency. The company competes with Force Protection Inc. (FRPT), General Dynamics Corp. (GD) and Boeing Co. (BA).
 
Based in Los Angeles, California, Northrop Grumman provides products, services and solutions in information and services, aerospace, electronics and shipbuilding to the military, government and commercial customers of United States and beyond. The company is the largest IT service provider to the federal government. In addition, Northrop Grumman is the only nuclear-powered aircraft shipbuilder in the United States. We maintain our Neutral recommendation on the shares.

Today, Argus maintains a “Buy” rating for General Dynamics Corporation (NYSE: GD) as it expects 2009 earnings to increase modestly from last year based on prospects for solid performance in the company's defense businesses.The price target has been raised from $74 to $76.

According to the Analysts “Following solid gains in the second and third quarters, we expect BUY-rated, Focus List selection General Dynamics to post modestly higher full-year earnings in 2009. Margins in the Aerospace unit are decreasing due to a recession-induced drop in demand for business jets. However, the company's other defense-related units are prospering, particularly Marine Systems, which is benefiting from increased production and improving margins on several multiyear shipbuilding programs.”

Deutsche analyst believes that “General Dynamics is one of three shipbuilders that stand to gain from the U.S. Navy's ship rebuilding program, and the company's large backlog should help to sustain earnings over the next 12-18 months.”

Yesterday, GD closed at $66.78.

Defense contractor General Dynamics (NYSE: GD) won a $54 million contract modification to build 24 additional combat operations centers for the U.S. Marine Corps. The centers built by General Dynamics enable command and control operations for Marines deployed in Afghanistan and Iraq.

The award, which modifies a contract initially granted to General Dynamics in 2002, now has a total value of $741 million. The centers also include networks of workstations and servers supporting standard tactical data systems and other software, voice, data communications systems.