At a time when playing the stock market can be a risky game, it might be a good idea to keep the motto, “a strong defense wins championships,” in mind. And one fund manager sees Elbit Systems (ELST) as a defensive play.

“Elbit is a strong company, since it has little dependence on the macroeconomy and has limited exposure to economic cycles,” said Jamia Jasper, portfolio manager of the American Israeli Shared Values Fund.

Elbit, an international defense electronics company that makes things likes lasers and unmanned vehicles, could go from its current price of $56 to $70 within the next year, said the money manager.

“It’s a niche player and is continually developing cutting-edge technologies and the industry itself has been consolidating over the past two decades, reducing the pool of competitors,” she said.

The Israeli defense contractor reported second-quarter results in August, posting a 40% rise in revenue to $653.2 million. The company earned $31.2 million, compared with a loss of $691,000 during the same period in 2007.

“That organic growth is key--they aren’t growing by acquisitions, they are expanding by technological developments,” said Jasper.   

The company also reported its backlog of orders for the second quarter rose to $5.05 billion, making it easier for Jasper and other investors to value the company in the future.

Jasper also likes the company’s diversified revenue stream, which includes expansion in several areas, including the U.S.

Being global makes the company less dependent on any one market, said Jasper. 

“The company continues to win contracts and gain customers in places all over the map, including Asia and the former Soviet Union,” she said, adding that the firm's strategy of diversifying away from Israeli businesses has been quite successful: “European sales grew 64% last quarter, and is now 31% of the company’s revenue."

Defense spending increases worldwide 5% to 10% each year, according to Jasper, and she doesn’t see a curb in that anytime soon, since homeland-security spending will continue to rise.

“Having the government as a client makes Elbit less affected by economic cycles,” said Jasper.