December 31 & 2016 Market Close: GovCon Index Lower, Ends at 16% YTD Gain

Executive Mosaic’s GovCon Index retreated Friday in the final trading session of 2016 to close a negative December but but a positive year on a boost to defense stocks in the post-election rally that has swept through U.S. markets.

The GovCon Index closes 2016 with a year-to-date gain of 16.73 percent as the U.S. stock bellwether S&P 500 composite index has added 9.33 percent over 12 months.

Friday’s close also put the GCI at only its second weekly decline since the Nov. 8 election upset win by Donald Trump as investors are betting on deregulation, tax cuts and increases to defense and infrastructure spending.

GovCon Index decliners outnumbered gainers by a 3-to-1 ratio in a light volume session Friday as none of the GCI’s 11 S&P 500 companies registered a gain with co-listed McKesson Corp. (NYSE: MCK) the overall largest net laggard.

McKesson’s decline coincided with the S&P healthcare index’s decline of nearly 0.4 percent.

On a yearly basis, 25 out of 30 GovCon Index companies advanced with Navistar International (NYSE: NAV) the largest percentage gainer overall on Volkswagen‘s investment in the heavy truck manufacturer disclosed in November.

L-3 Communications (NYSE: LLL) led percentage gainers for GovCon Index stocks also included in the S&P 500 and seventh out of the overall 30, while of 11 co-listed companies rose for the year with McKesson the largest decliner in the GCI.

Investors retreated from health shares after the election as Trump made a repeal of Obamacare legislation a cornerstone of his campaign.

Government technology services contractors Science Applications International Corp. (NYSE: SAIC) and ICF (Nasdaq: ICFI) finished second and third respectively with ManTech International (Nasdaq: MANT) in fifth.

Military shipbuilder Huntington Ingalls Industries (NYSE: HII) closed fourth for year-to-date percentage gainers as investors view HII as a beneficiary of Trump’s goal to increase the U.S. Navy‘s fleet size during his term in office.

Orbital ATK (NYSE: OA) closed second-lowest for percentage decliners as the latter is in the process of restating three years of financial results on accounting errors related to a large U.S. Army production contract.

BAE Systems PLC (over-the-counter) and KBR (NYSE: KBR followed in second- and third-worst.

Maximus (NYSE: MMS) registered the GCI’s fifth-largest percentage loss for 2016 in a retreat as the company is a major contractor for the Obamacare implementation effort.

Leidos Holdings (NYSE: LDOS) added 23.15 percent in a year that saw the company announce on Jan. 26 its merger into the former Lockheed Martin (NYSE: LMT) information technology segment in a deal that closed Aug. 16 and created the largest GovCon services player at $10 billion in annual sales.

Lockheed in turn climbed 14.94 percent year-to-date as its flagship F-35 program moved forward and figures to continue as the focal point of investor attention in 2017 after Trump’s various Twitter criticisms of the fighter jet’s costs.

Market Summary for 2016

IndexValue% Change
GovCon Index87.977 +16.73%
S&P 5002, 238.83+9.33%
Dow Jones Industrial Average19, 762.60+13.23%
NASDAQ5, 383.12+7.29%
Advancing GovCon Index Issues25
Declining GovCon Index Issues5
Unchanged GovCon Index Issues0

Top GovCon Index Percentage Performers for 2016

SymbolCompany$ Current Price% Change
NAVNavistar International31.37+254.07%
SAICSAIC84.30+84.88%
ICFIICF55.20+55.37%
HIIHuntington Ingalls Industries184.19+45.14%
MANTManTech International42.25+39.52%

Lowest GovCon Index Percentage Performers for 2016

SymbolCompany$ Current Price% Change
MCKMcKesson Corp.140.45-28.81%
OAOrbital ATK87.73-1.78%
BAESYBAE Systems PLC29.03-1.41%
KBRKBR16.69-1.39%
MMSMaximus55.79-0.92%

Friday Market Summary

IndexValueNet Change% Change
GovCon Index87.977-0.308-0.349%
S&P 500 2, 238.83-10.43-0.46%
Dow Jones Industrial Average19, 762.60-57.18-0.29%
NASDAQ5, 383.12-48.97-0.90%
Advancing GovCon Index Issues7
Declining GovCon Index Issues23
Unchanged GovCon Index Issues0

Lowest GovCon Index Net Performers

SymbolCompany$ Current PriceNet Change ▾% Change
MCKMcKesson Corp. *140.45-1.33-0.94%
CACICACI International124.30-1.00-0.80%
LLLL-3 Communications *152.11-0.86-0.56%
OAOrbital ATK87.73-0.73-0.83%
COLRockwell Collins92.76-0.69-0.74%

Lowest GovCon Index Percentage Performers

SymbolCompany$ Current PriceNet Change% Change ▾
NAVNavistar International31.37-0.42-1.32%
KBRKBR16.69-0.17-1.01%
MCKMcKesson Corp. *140.45-1.33-0.94%
OAOrbital ATK87.73-0.73-0.83%
CACICACI International124.30-1.00-0.80%

Top GovCon Index Net Performers

SymbolCompany$ Current PriceNet Change ▴% Change
ICFIICF55.20+0.35+0.64%
GIBCGI Group48.03+0.31+0.65%
MMSMaximus55.79+0.23+0.41%
CUBCubic Corp.47.95+0.20+0.42%
CAECAE13.97+0.06+0.43%

Top GovCon Index Percentage Performers

SymbolCompany$ Current PriceNet Change% Change ▴
GIBCGI Group48.03+0.31+0.65%
ICFIICF55.20+0.35+0.64%
CAECAE13.97+0.06+0.43%
CUBCubic Corp.47.95+0.20+0.42%
MMSMaximus55.79+0.23+0.41%
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