News of the first delivery of the first 50-meter high-speed catamaran to a Taiwanese customer has failed to float the Austal Limited (ASX: ASB) share price.
The ASB share price fell 1.1% to $2.32 in morning trade even as the S&P/ASX 200 (Index:^AXJO) (ASX:XJO) index gained 0.2% after a lacklustre start to trade today.
The delivery of the catamaran is the first of two 550-passenger vessels ordered by Brave Line in September 2017 that Austal is building at its Philippines' shipyard.
Rise of Austal's lower cost shipyard
This is a pleasing development as it shows that the lower-cost shipyard is capable of designing and constructing high-tech vessels using Austal's intellectual property.
"Following its establishment in 2012, we have recently trebled construction capacity at the shipyard to provide the capability to build the largest ferries in Austal's portfolio," said Austal's chief executive David Singleton.
"Our Philippines shipyard now employs more than 800 highly skilled local employees in a broad range of professional, technical and trade roles. Austal Philippines has been responsible for developing the local SME industry and supply chain whilst also collaborating with local universities and educational establishments to truly develop a sovereign industrial capability for the Philippines."
Austal's Philippines shipyard in Cebu is also building the next generation 109 metre high-speed catamaran for Fjord Line of Norway.
Investors shouldn't be too worried about the fall in Austal's share price. The stock is up 30% over the past year and is trading close to a 3.5-year high.
Foolish takeaway
Shares in Austal continues to enjoy several tailwinds. This includes the new arms race, which is forcing governments (including ours) to up spending on defence, and the weakening Australian dollar.
Adding a stock like Austal to your portfolio can help diversify risk from the wobblily Australian economy as pressure grows on the Reserve Bank of Australia to cut interest rates to help curb the slowdown.
But Austal isn't the only overseas exposed stock that's worth putting on your radar. I think building materials supplier James Hardie Industries plc (ASX: JHX), steel products maker BlueScope Steel Limited (ASX: BSL) and gaming machine group Aristocrat Leisure Limited (ASX: ASX) are also attractive options for their US-dollar exposure.
