Frequency Electronics (FEIM), a microcap defense company with a market capitalization of $300MM, is poised for significant growth due to its involvement in two high-profile military programs: the Golden Dome and THAAD. Despite its under-the-radar status, FEIM has the potential to be an attractive acquisition target for larger peers, similar to KRKNF. While fundamentals are decent, this investment thesis is primarily event-driven.

Luckily, there is virtually no sellside coverage of FEIM at present, providing a unique opportunity for investors to get in on the ground floor. In fact, Craig Hallum recently initiated coverage with a $43 price target, highlighting the company’s potential for significant growth. With its involvement in these two critical military programs, FEIM is well-positioned to benefit from increased government spending and a growing demand for advanced defense technologies.

As the US government continues to prioritize military modernization and defense spending, companies like FEIM are likely to see increased demand for their products and services. With its strong track record of delivering high-quality solutions on time and within budget, FEIM is well-positioned to take advantage of these trends.

While the company’s current market capitalization may be a deterrent for some investors, it’s important to remember that size doesn’t always determine a company’s potential for growth. In fact, smaller companies like FEIM often have more agility and flexibility than their larger peers, allowing them to quickly adapt to changing market conditions and take advantage of new opportunities.

Frequency Electronics (FEIM) represents an exciting opportunity for investors looking to capitalize on the growing demand for advanced defense technologies. With its involvement in two high-profile military programs and virtually no sellside coverage, FEIM is poised for significant growth in the coming years. Despite its under-the-radar status, this microcap defense company has the potential to be an attractive acquisition target for larger peers, making it a worthwhile addition to any investment portfolio.