* Updating stale valuation - 9 Apr 21 - this recently demonstrated why supplying defense organisations can be so flukey after its biggest single customer - a Boeing subsidiary - slashed its order profile the day after Boeing revealed massive losses. It's since signed a new contract with Textron but I'll remain a watcher for now. Orbital is a company that has evolved its primary operation since inception to remain relevant. It's had various missteps along the way and that's led to a rollcoaster ride for shareholders over the past decade. In recent years it's singular focus has been on supplying engines for use in UAV vehicles, primarily for a subsidiary of Boeing but it's recently signed agreements with Northropp Grumann and another smaller deal. It doubled revenue in 2020, is profitable and was one of the few companies to provide a revenue outlook (the midpoint of which represents 35% growth). It ticks a lot of boxes financially and is arguably a defensive (even counter cyclical) play. The fact it makes something and that something has a military application gives it a bit sex appeal too (memo to self: focus on the financials). A few things to watch out for: - the valuation assumes modest opex growth 20% p.a. falling to 7% in its terminal year. OEC does seem to be able to curtail excessive spend over its history but revenue is now growing faster than it has before - GM fell sharply in 2020 from over 70% to less than 60%. Time will tell if this is the new normal or additional scale will allow that to gradually revert - Perhaps the biggest one is in it's history OEC has not been great at converting profit into operating cashflow. Between 2011 and 2019 it converted just half it's EBITDA (plus interest costs) into operating cashflow. It did much better in 2020 but something to watch. Disclosure: I am just a watcher of this stock currently. At the $1 mark it drifted towards recently it gives a much larger margin for error.