MBAA 518 Research and Analysis of Rockwell Collins
Embry Riddle Aeronautical University – MBAA 518
May 8th, 2013
Rockwell Collins is an international company with operations in twenty-seven countries. The primary products and services of the firm serve the aviation industry, with a focus on communications and avionics equipment and services. The market served by Rockwell Collins can be divided into the commercial and government sectors. While not the largest competitor in its industry, the research presented will demonstrate that the firm has very capable financial management, and that the capitalization of the enterprise is well-structured in order for the ...view middle of the document...
A significant amount of information will be gleaned from the firm’s annual report, with a focus on the financial statements presented therein. In addition to financial statements, other industry data will be presented and analyzed such as comparisons to peers using financial ratios. The stock price performance will also be presented and analyzed with a specific focus on the relationship between volatility and management strategies. The firm’s capitalization structure will also be researched and evaluated. The aggregate of the findings will provide a sufficient pool of data from which to draw conclusions concerning Rockwell Collin’s present performance as well as its future prospects.
Truly a global company, Rockwell Collins has operations in twenty-seven countries. The company’s primary goods and services consist of communication and aviation related products and services. These products and services are utilized in flight control, information management, aircraft cabin, and flight deck systems. The business can be divided into two broad categories; commercial systems and government systems. The emerging global trends of a growing commercial aviation sector as well as an increased need for security and defense products are the key drivers of the firm’s future growth strategy (Rockwell Collins, Inc. A, 2013).
Over 20,000 employees support Rockwell Collins’ global locations throughout North America, South America, Europe, Middle East, Asia and Australia. A key component of the company’s strategy is to engage local markets locally. “We recognize that to sell globally, we must be global; connecting with local customers, understanding specific requirements and gaining familiarity with culture, languages and processes” (Rockwell Collins, Inc. A, 2013, p. 7).
Rockwell Collins is the fifth largest company based on market capitalization in the aerospace/defense products and services industry, with a present market capitalization of $8.5 billion. (Yahoo! Inc., 2013). The firms with a larger market capitalization in this industry are United Technologies Corporation ($85.4 billion), Boeing Company ($64.2 billion), Lockheed Martin Corporation ($30.3 billion), and General Dynamics Corporation ($24.4 billion). These firms are the primary competitors of Rockwell Collins. It should be noted that the Boeing Company is the only firm of this group that presently manufactures complete aircraft. While Boeing Company is a competitor in this industry, it is also a key client of Rockwell Collins’ (Rockwell Collins Inc. C, 2012).
It would be difficult to draw accurate comparisons between the market share of Boeing and Rockwell Collins given that the significant majority of Boeing’s revenue comes from aircraft manufacturing rather than the industry of communication and avionics products and services. Accordingly, the Boeing Company will not be utilized for the purposes of determining Rockwell Collins’ market share when utilizing the metric of...