We're going to put some cash to work today, increasing the size of one of our favorite One-rated names. After you receive this Alert we will pick up 200 shares of Bruker BioSciences (BRKR) , which was recently trading around $8.90.
About a month ago, Bruker announced that it had received a contract award from the U.S. Department of Homeland Security -- a $1.3 million follow-on award for phase III of the Autonomous Rapid Facility Chemical Agent Monitor (ARFCAM) program. This program is aimed at developing and testing the next generation of automated/unattended chemical agent and toxic chemical detectors for government facilities.
We have pointed to Bruker's work in the chemical and nuclear detection area as one of the drivers for share price appreciation over the next year. We believe that sales of the company's traditional spectrometry and X-ray equipment will remain in an uptrend due to strong demand and the brand's excellent reputation, while additional growth will come from government-related deals like the ARFCAM program and the $3.5 million contract with the Slovenian Army that Bruker was awarded during the summer (see our Aug. 23 Alert for more details).
Other future positives that could help drive shares higher include lower 2008 tax rates in Germany and continuing weakness in the U.S. dollar. Bruker's international exposure has been a major part of our thesis, as the company is well-positioned to benefit from demand in both emerging and established markets in Europe, Asia and even South America.
Today's purchase will bring our position in Bruker to just under 6% of the model portfolio, which we feel is appropriate considering our long-term bullishness and the fact that shares are still more than 20% below their 52-week high.
Frank Curzio is a research associate at TheStreet.com.
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