Huntington Ingalls and L3 really are pure plays, and both of them have been performing nicely despite the downturn in defense spending. But Huntington Ingalls is all about warships, so companies would have to be comfortable with shipbuilding to buy it. Northrop Grumman owned the operation for a decade before giving up on trying to make it perform like the company’s other units. L3 would probably be an easier fit for companies that are already in the military electronics business, but it’s just about the biggest of the mid-tiers. In fact, Byron Callan of Capital Alpha Partners rates it as a first-tier player, even though its market cap is less than $8 billion.
http://www.forbes.com/sites/lorenthompson/2013/06/24/defense-consolidation-who-gets-bought-first/
