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Global political uncertainties often rekindle the discussion surrounding military contractors and their importance in national defense. The ongoing invasion of Ukraine by russia has prompted governments to increase military spending, which has dramatically impacted the demand for military systems and combat vehicles around the world.
US military contractors are some of the largest corporations in the country, with specialized complex supply chains and a wide range of solutions and hardware.
The interest in combat-readiness of nations is unlikely to wane in the near future, which promises successful years for military stocks - at least in the short run.
If you are curious about which military stocks may deserve a spot in your portfolio then you are sure to find one or two that might interest you in the following article.
Military corporations do not function as any other manufacturing or digital services companies. Most of these companies deal with governments and are heavily dependent on defense contracts. Once a contract has been posted, the companies compete with each other and present their solutions to win the contract as a prize. This makes military stocks heavily dependent on government policy, as a shift away from high defense spending could mean that the existing supply chains of these companies would have to be recalibrated to meet demand in allied countries.
The peculiarities of global geopolitics also limit the available markets where these companies can sell their solutions, which is one of the reasons why military systems can be incredibly expensive. Research and development are key costs for military companies, as they need to be up to date in order to meet the demand of governments worldwide.
The Lockheed Martin Corporation is an aerospace and security company that specializes in the research, development, and manufacture of military systems in the United States and worldwide.
The company produces:
The company frequently works with the US Department of Defense, NASA, and other government agencies and also sells its products through US government contracts overseas. Lockheed Martin Corporation was founded in 1912 and is headquartered in Bethesda, Maryland.
Lockheed Martin has enjoyed a successful 2022, which saw the demand for defense systems increase drastically due to russia’s invasion of Ukraine. Governments across the world, and especially members of NATO, have increased their defense budgets, which prompted investors to bet heavily on defense giants, such as Lockheed Martin.
While Lockheed’s growth throughout 2022 has been low, investors are anticipating a long-term net positive for the company, which is poised to possibly have an even more successful 2023.
However, recession fears still keep most investors on their toes when maintaining large stocks in the long run, which may become an issue if a recession officially hits the US economy. 2022 has seen Lockheed’s stock climb from $354 to $481, which is a 35% increase since the start of the year.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $16,583 mln | $15,446 mln | $16,028 mln | $67,044 mln |
Cost of revenue | $14,463 mln | $13,490 mln | $13,726 mln | $56,315 mln |
Operating expense | – | $7 mln | $8 mln | $62 mln |
Net income | $1,778 mln | $309 mln | $614 mln | $6,315 mln |
Diluted EPS | 6.71 | 1.16 | 2.21 | 22.76 |
Assets | $52,030 mln | $51,758 mln | $51,843 mln | $50,873 mln |
Liabilities | $40,064 mln | $40,326 mln | $42,212 mln | $39,914 mln |
Equity | $11,966 mln | $11,432 mln | $9,631 mln | $10,959 mln |
Cash & cash equivalents | $2,430 mln | $1,775 mln | $2,727 mln | $3,604 mln |
Free cash flow | $2,728 mln | $1,027 mln | $1,621 mln | $1,860 mln |
Lockheed has a very solid balance sheet, with decent cash reserves in the off chance of a credit crunch. Total liabilities are considerably below total assets, which is also a plus for investors. Earnings have been strong in FY 2021 and while 2022 shows a decline in that regard, Lockheed seems to be ready for the upcoming demand-side boost for the defense market. While revenue growth has also been modest, this is to be expected from a mature corporation like Lockheed.
Lockheed Martin has had a busy 2022 with some important events including:
These important developments point to a healthy amount of new contracts and revenue streams for Lockheed Martin, which puts the company in a firm position to take advantage of the growing demand for military solutions and systems around the world.
The Boeing Company develops, manufactures, and sells commercial and military aircraft, satellites, launch systems, and related services in the United States and worldwide.
The company’s operations are divided into four segments:
The Boeing Company was founded in 1916 and is based in Chicago, Illinois, United States. The company employs over 120,000 people across its four divisions.
Boeing’s stock has been struggling since issues with the 737 MAX started. The company is desperate for new orders and has been racking up debt to help transition from this rough period. This has had a visible effect on the stock price. The 2022 bear market has been rough on most stocks available and Boeing’s mountain of debt does not inspire much confidence in investors either.
Investors are shying away from the major turbulence affecting the stock in 2022, most being weary of the company’s ability to turn things around and not let the debt burden spiral out of control. Boeing, on the other hand, has been trying to reduce costs and increase efficiency, which was the reason behind the company’s operational changes - reducing the number of divisions to 4.
Increased competition from the likes of Airbus has long been a cause for concern for Boeing investors, and Boeing’s performance has only enforced those concerns.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $15,956 mln | $16,681 mln | $15,278 mln | $62,286 mln |
Cost of revenue | $16,778 mln | $14,559 mln | $13,566 mln | $59,269 mln |
Operating expense | $1,953 mln | $1,366 mln | $1,672 mln | $6,406 mln |
Net income | ($3,275 mln) | $193 mln | ($109 mln) | ($4,202 mln) |
Diluted EPS | (5.49) | 0.32 | (0.19) | (7.15) |
Assets | $137,558 mln | $135,479 mln | $146,846 mln | $138,552 mln |
Liabilities | $155,193 mln | $150,270 mln | $161,122 mln | $153,398 mln |
Equity | ($17,635 mln) | ($14,791 mln) | ($14,266 mln) | ($14,846 mln) |
Cash & cash equivalents | $14,257 mln | $11,448 mln | $19,995 mln | $16,244 mln |
Free cash flow | $2,906 mln | ($182 mln) | ($507 mln) | ($4,396 mln) |
Boeing’s financials show some major warning signs for investors. The company is failing to maintain profitability quarter-over-quarter. The overwhelming amount of liabilities are also heavily weighing down Boeing’s balance sheet. The company needs to recover from the 737 MAX issues and increase the number of new contracts to turn things around in the long run.
The short-term financials show unresolved issues in debt and backlog management, which started even before the Covid-19 pandemic hit and ongoing supply chain issues have only exacerbated the problem.
The Q3 report states that Boeing will be consolidating its eight Defense, Space, and Security divisions into four. The restructuring aims to streamline Boeing’s defense branches for greater operational efficiency.
Under the restructure, BDS will now consist of the following divisions:
The structural overhaul seeks to improve operational efficiency for the various divisions within the company and create a more flexible internal structure for Boeing's defense portfolio.
The Northrop Grumman Corporation operates as a global aerospace and defense company. The corporation manufactures a wide variety of military systems and hardware, including, but not limited to:
Over 35% of Northrop’s operations revolve around military aircraft and related solutions. The company employs approximately 90,000 people. Northrop Grumman was founded in 1939 and is headquartered in West Falls Church, Virginia, United States.
Northrop Grumman, much like Lockheed Martin, has enjoyed steady growth since the start of 2022. The stock rose from $385 to $518 - an approximately 35% increase. An already impressive backlog, coupled with the ongoing war and increased demand for military systems have affected investors' sentiment toward defense stocks. Many analysts advise buying Northrop and Lockheed stock at noticeable dips, as they expect the stocks of major defense contractors to soar higher in 2023.
Northrop Grumman also has an impressive dividend yield sitting at 1.32%. The stock is a decent alternative for dividend investors as well.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $8,971 mln | $8,801 mln | $8,720 mln | $35,667 mln |
Cost of revenue | $7,153 mln | $6,842 mln | $6,786 mln | $28,399 mln |
Operating expense | $972 mln | $1,005 mln | $891 mln | $3,597 mln |
Net income | $915 mln | $946 mln | $1,063 mln | $7,005 mln |
Diluted EPS | 5.89 | 6.06 | 6.63 | 43.54 |
Assets | $42,733 mln | $41,914 mln | $42,346 mln | $42,579 mln |
Liabilities | $28,790 mln | $28,263 mln | $30,929 mln | $29,653 mln |
Equity | $13,943 mln | $13,651 mln | $11,417 mln | $12,926 mln |
Cash & cash equivalents | $1,666 mln | $1,169 mln | $4,055 mln | $3,530 mln |
Free cash flow | $1,039 mln | ($460 mln) | $916 mln | $2,152 mln |
Northrop’s EPS and shareholder’s equity are the highlights from the company’s financial statements. However, the cash position is far from stellar, which may prompt the company to increase its debt load to fund new investments without lowering dividends. Supply chain issues have also increased the cost of sales and operating expenses for the company, which may be a recurring issue throughout 2023 as well.
Some of the highlights from Northrop Grumman’s 2022 operations include:
These are just a few of the ongoing projects undertaken by Northrop Grumman, which indicates that the company has a significant backlog heading into 2023.
Huntington Ingalls is a company that engages in the design, manufacturing, and repair of military naval vessels in the United States. The company operates through three distinct segments; Ingalls Shipbuilding, Newport News Shipbuilding, and Technical Solutions.
Huntington Ingalls actively develops and manufactures nuclear-powered vessels, such as aircraft carriers and submarines, while also providing repair, overhaul, maintenance, and decommissioning of said vessels.
The company also provides life-cycle management for US Navy nuclear ships. Huntington Ingalls Industries was founded in 1886 and is based in Newport News, Virginia, United States.
Similarly to other major defense contractors on this list, Huntington Ingalls enjoyed a fruitful year in 2022. The stock has increased 22% since the start of the year. The supply chain issues and the importance of naval defense caused governments to invest more in the acquisition of military ships. The re-emergence of nuclear energy as an important fuel source also causes the technology used by Huntington Ingalls in the development of nuclear warships to remain relevant.
Huntington Ingalls is also a viable dividend stock, with the company increasing its dividend to $1.24 per share as of Q3 2022.
However, the company has not been able to rapidly meet the growing demand, which may be an issue in the long run if Huntington Ingalls fails to capitalize on the growing defense spending trend.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $2,626 mln | $2,662 mln | $2,338 mln | $9,524 mln |
Cost of revenue | $2,264 mln | $2,272 mln | $2,007 mln | $8,156 mln |
Operating expense | $244 mln | $226 mln | $224 mln | $896 mln |
Net income | $138 mln | $178 mln | $147 mln | $544 mln |
Diluted EPS | 3.44 | 4.44 | 3.65 | 13.50 |
Assets | $10,615 mln | $10,586 mln | $10,400 mln | $8,157 mln |
Liabilities | $7,567 mln | $7,634 mln | $8,211 mln | $6,256 mln |
Equity | $3,048 mln | $2,952 mln | $2,189 mln | $2,808 mln |
Cash & cash equivalents | $117 mln | $375 mln | $555 mln | $627 mln |
Free cash flow | ($96 mln) | $208 mln | $268 mln | $429 mln |
Huntington Ingalls has an overall healthy balance sheet, however, the cash reserves are limited and this could stifle growth in 2023. While the company is profitable, net income and cash will need to increase if the company is to increase production without increasing its debt burden in the long run.
Huntington Ingalls has acquired new contracts in 2022, as well as unveiling important new developments:
Parsons Corporation provides integrated solutions for the defense and intelligence markets in the United States and internationally. The company frequently collaborates with the Department of Defense in providing defensive and offensive cybersecurity solutions.
Parsons also offers transport system management and engineering services.
The company was founded in 1944 and is based in Centreville, Virginia, United States.
Parsons’ stock has been steadily increasing since the start of 2022. The stock price reached $48 in November, which is a year-to-date increase of over 38%. The rising demand, coupled with the company’s admirable financial performance has convinced investors to bet on the stock’s long-term success. Parsons is still a relatively smaller player in the defense industry, which gives the company ample room for growth in the long run.
A number of important government contracts have added to the growth of the stock, which currently sits at a $5 billion market capitalization.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $1,134.4 mln | $1,008.7 mln | $956 mln | $3,660.8 mln |
Cost of revenue | $872.4 mln | $781.8 mln | $734.7 mln | $2,808 mln |
Operating expense | $197 mln | $200 mln | $191.2 mln | $757.2 mln |
Net income | $29.6 mln | $18.3 mln | $19.4 mln | $64.1 mln |
Diluted EPS | 0.27 | 0.17 | 0.18 | 0.59 |
Assets | $4,095 mln | $4,109.8 mln | $3,823.9 mln | $3,830.9 mln |
Liabilities | $2,089.9 mln | $2,145.1 mln | $1,970 mln | $1,893.8 mln |
Equity | $2,005.1 mln | $1,964.7 mln | $1,853.9 mln | $1,937.1 mln |
Cash & cash equivalents | $147.5 mln | $126 mln | $275.5 mln | $342.6 mln |
Free cash flow | $116.8 mln | $41.9 mln | $73.6 mln | $184.5 mln |
While Parsons maintains impressive QoQ revenue growth, net income is still rather limited, which places more pressure on the company’s cash reserves. The total cash position has seen a significant decline compared to Q3 of 2021. Parsons has a relatively healthy balance sheet and could tap into debt financing to fuel growth in 2023.
Profit margins remain a challenge for the company, which can be problematic in the long run, unless operating costs shrink.
Parsons has managed to acquire some significant contracts in 2022, while actively working on developing its existing suite of defense systems:
AeroVironment Inc designs, develops, and manufactures robotic systems and software solutions for the US government and overseas partners. The company develops and sells a broad range of military systems, such as:
The company supplies a range of drones, including the Puma, T-20, Jump 20, and Raven models. The company was incorporated in 1971 and is headquartered in Arlington, Virginia, United States.
The increasing use of drones and other unmanned vehicles in warfare has revealed the massive potential of the UAV industry. The ongoing war has increased the demand for AeroVironment’s drones and investors were quick to notice the trend.
Many analysts advise buying the stock after any significant stumble, as they expect AVAV to keep rising in 2023.
The stock has seen gains of just under 45% since the start of 2022 and while the company remains unprofitable, the losses have been decreasing in the long run, which makes investors hopeful of profitability in the near future.
Q1 FY2023 | Q4 FY2022 | Q1 FY2022 | Full FY2022 | |
Revenue | $108.5 mln | $132.6 mln | $101 mln | $445.7 mln |
Cost of revenue | $74.8 mln | $84 mln | $72.3 mln | $304.5 mln |
Operating expense | $37 mln | $35.6 mln | $40.8 mln | $151.1 mln |
Net income | ($8.4 mln) | $7.3 mln | ($14 mln) | ($4.2 mln) |
Diluted EPS | (0.34) | 0.29 | (0.57) | (0.17) |
Assets | $896.7 mln | $914.2 mln | $908.6 mln | $914.2mln |
Liabilities | $296.5 mln | $306 mln | $310.3 mln | $306 mln |
Equity | $600.2 mln | $608.2 mln | $598.3 mln | $608.2 mln |
Cash & cash equivalents | $102 mln | $180.7 mln | $93.9 mln | $102 mln |
Free cash flow | $10.5 mln | $8.3 mln | ($20.7 mln) | ($31.9 mln) |
As a growth-oriented company, AeroVironment has been largely unprofitable for most of its history, but the losses have been considerably reduced. The company also maintains a decent amount of cash and limited amounts of liabilities.
The cost of revenue and operating expenses are relatively high, which is to be expected considering the supply chain issues brought about by the war.
The company seems to be on a solid path toward growth and profitability. If they manage to become profitable in 2023, this could be an added boost for the company’s cash reserves to fuel further growth in the long run.
AeroVironment’s drones have been instrumental in the United States’ support of the Ukrainian war effort. Amid the growing interest toward AVAV’s drone arsenal, the company was also able to acquire some important contracts in 2022 - while increasing production capacity:
Raytheon Technologies is a defense and aerospace company that provides military systems and solutions to commercial, military, and government customers in the United States and worldwide.
Raytheon operates through four segments:
The original Raytheon Company was founded in 1922 and is headquartered in Waltham, Massachusetts, United States.
Raytheon's stock has had a turbulent 2022. While the stock is up 11% since the start of the year, the company cratered in October, before bouncing back from the start of November. Lower ROE figures raised concerns regarding Raytheon’s future growth. However, the Q3 earnings helped the stock regain its position. The Collins Aerospace and Pratt & Whitney segments have been the growth drivers for Raytheon, while the company slightly lowered its annual revenue guidance to the $67-$67.3 billion range, compared to the $67.75 - $68.75 billion stated in prior periods. While Raytheon’s growth may not be stellar, the company still generates considerable amounts of cash, which puts it in an advantageous position heading into 2023.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $16,951 mln | $16,314 mln | $16,213 mln | $64,388 mln |
Cost of revenue | $13,464 mln | $12,856 mln | $13,089 mln | $51,897 mln |
Operating expense | $2,007 mln | $2,105 mln | $1,781 mln | $7,533 mln |
Net income | $1,387 mln | $1,304 mln | $1,393 mln | $3,864 mln |
Diluted EPS | 0.94 | 0.88 | 0.93 | $2.56 |
Assets | $158,225 mln | $159,017 mln | $158,772 mln | $161,404 mln |
Liabilities | $86,457 mln | $86,989 mln | $85,803 mln | $86,705 mln |
Equity | $71,768 mln | $72,028 mln | $72,969 mln | $74,699 mln |
Cash & cash equivalents | $5,381 mln | $4,767 mln | $7,476 mln | $7,832 mln |
Free cash flow | $185 mln | $766 mln | $1,418 mln | $4,749 mln |
Raytheon is a mature company with limited revenue growth to be expected. The company is consistently profitable quarter after quarter. However, the EPS figures lag behind competitors such as Northrop Grumman and Lockheed Martin.
Raytheon has been awarded an OTA to participate in the US Army’s Tactical Intelligent Targeting AccessNode (TITAN) program.
The Raytheon Technologies team is designing TITAN to serve as the Army’s prime solution to enable multi-domain data-gathering operations.
TITAN will ingest data from space and high-altitude, aerial and terrestrial sensors to gather data for defense systems. The Raytheon-developed solution will also include targeting, analytics, and situational awareness tools for commanders. The DoD’s plan is to connect all aspects of combat data into one system. Raytheon is working on providing secure communications, advanced sensors, software solutions, and smart effectors to enable DoD’s JADC2 architecture to be operational.
BWX Technologies is a company that manufactures and sells nuclear components in the United States and worldwide. The company operates through three segments:
The company was founded in 1867 and is headquartered in Lynchburg, Virginia, United States.
BWX shares have risen from $48.5 to $60.3 since the start of 2022. The stock’s growth has been fueled by the rising demand for nuclear naval vessels and the general rhetoric toward the importance of nuclear energy on the path to net zero emissions.
The company’s financial results have also shown slight improvement over the year, which has prompted investors to add BWX to their defense stock portfolios.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $523.7 mln | $554.2 mln | $498.7 mln | $2,124.1 mln |
Cost of revenue | $399.3 mln | $413 mln | $361.5 mln | $1,573.8 mln |
Operating expense | $59.6 mln | $57.3 mln | $61.3 mln | $241.5 mln |
Net income | $61.6 mln | $74.6 mln | $59.9 mln | $305.9 mln |
Diluted EPS | 0.67 | 0.82 | 0.63 | 3.24 |
Assets | $2,672 mln | $2,705.5 mln | $2,489.7 mln | $2,501.4 mln |
Liabilities | $1,959.1 mln | $2,001.2 mln | $1,911.1 mln | $1,864.1 mln |
Equity | $712.9 mln | $704.3 mln | $578.6 mln | $617.8 mln |
Cash & cash equivalents | $55.2 mln | $71.2 mln | $73.2 mln | $37.7 mln |
Free cash flow | $25.4 mln | $34.9 mln | $0.8 mln | $75 mln |
While BWX has not shown explosive growth, it remains stable in the short term with a healthy balance sheet. The company is profitable, which is good news for investors in the long run.
BWXT has had a busy 2022, with several important projects and milestones reached this year, including:
General Dynamics is an aerospace and defense company that designs, develops, manufactures, and sells military systems in the United States and worldwide. The company operates through four segments:
All major US defense contractors have had a year of growth in 2022. General Dynamics stock has risen by 21% since the start of the year. The stock also maintains a 2% annual dividend yield, which is higher than most military stocks on the market.
The growing demand for military aircraft, tanks, and solutions has been priced in by the market and investors are hopeful of GD’s ability to meet growing demand in 2023.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $9,975 mln | $9,189 mln | $9,568 mln | $38,469 mln |
Cost of revenue | $8,310 mln | $7,957 mln | $7,938 mln | $32,061 mln |
Operating expense | $567 mln | $614 mln | $550 mln | $2,245 mln |
Net income | $902 mln | $766 mln | $860 mln | $3,257 mln |
Diluted EPS | 3.26 | 2.75 | 3.07 | 11.55 |
Assets | $51,116 mln | $50,481 mln | $51,370 mln | $50,073 mln |
Liabilities | $33,465 mln | $33.1 mln | $35,649 mln | $32,432 mln |
Equity | $17,651 mln | $17,381 mln | $15,721 mln | $17,641 mln |
Cash & cash equivalents | $2,496 mln | $2,223 mln | $3,139 mln | $1,603 mln |
Free cash flow | $1,028 mln | $435 mln | $1,275 mln | $3,384 mln |
Similarly to major defense contractors like Lockheed Martin and Northrop Grumman, General Dynamics has a high cost of revenue, but an impressive EPS nonetheless. The company also has a solid cash position and positive free cash flow, which allows it to upscale operations without incurring unsustainable amounts of debt. Revenues have also shown growth compared to Q3 2021, which is a positive sign for investors.
General Dynamics maintains a host of active government and commercial contracts, which include some additions in 2022, such as:
This is only a portion of General Dynamic’s ongoing contracts heading into 2023, which put the company in solid standing to take advantage of the growing military spending globally.
Textron is a company that operates in the defense, industrial and financial sectors. The company divides its business into segments, such as:
Textron serves the US and international markets. The company was founded in 1923 and is based in Providence, Rhode Island, United States.
Unlike other major defense stocks, Textron has had a mixed 2022. The stock has not seen much decline or growth since the start of the year. However, this underperformance could indicate a discount for Textron in the long run. While the company’s revenue growth is not overwhelming, the company is relatively stable, profitable, and has the capacity to upscale production to meet growing demand.
Investors are also optimistic about the insider ownership of Textron, which indicates the management’s positive expectations regarding the long-term performance of the company. Insiders own around $60 million worth of Textron shares.
Q3 FY2022 | Q2 FY2022 | Q3 FY2021 | Full FY2021 | |
Revenue | $3,078 mln | $3,154 mln | $2,990 mln | $12,382 mln |
Cost of revenue | $2,584 mln | $2,641 mln | $2,486 mln | $10,297 mln |
Operating expense | $258 mln | $278 mln | $283 mln | $1,221 mln |
Net income | $225 mln | $217 mln | $185 mln | $746 mln |
Diluted EPS | 1.06 | 1.00 | 0.82 | 3.30 |
Assets | $15,956 mln | $15,879 mln | $15,269 mln | $15,827 mln |
Liabilities | $9,194 mln | $9,078 mln | $9,232 mln | $9,012 mln |
Equity | $6,762 mln | $6,801 mln | $6,037 mln | $6,815 mln |
Cash & cash equivalents | $1,884 mln | $1,841 mln | $2,182 mln | $2,117 mln |
Free cash flow | $270 mln | $306 mln | $325 mln | $1,223 mln |
Textron’s revenue growth has been stagnant in 2022, however, the company’s profitability is increasing, which is important for Textron’s cash reserves.
Many analysts have touted Textron as a value investment due to its growing net income and overall solid cash position.
Military stocks have had a stellar 2022 so far and the tendency for governments to increase defense spending is not likely to subside just yet. Defense companies are trying to rise to the challenge and meet the increasing demand, while recovering from the numerous supply chain issues brought about by the Covid-19 pandemic.
From giants such as Lockheed and Boeing, to smaller players like AeroVironment, military stocks offer a diverse set of solutions that are also fit for civilian applications.
With the defense industry set to grow substantially in the coming decades, some key areas, such as space defense and tactical drones will be important growth drivers for the industry.
Military stocks could continue their growth momentum well into 2023 and beyond. With the ongoing war between Ukraine and russia prompting governments to spend more on defense, the increased demand is likely to be sustained through 2023.
The ongoing war between Ukraine and russia has prompted governments to allocate larger portions of their national budgets to defense spending, which has increased the demand for goods and services provided by military companies. This rise has contributed to the rapid increase in share price for most defense stocks in the US.
Most military stocks are poised to take advantage of the growth in demand for military systems and equipment. Stocks, such as Lockheed Martin, Northrop Grumman and Textron are likely to enter the new year with a healthy balance sheet and the capacity to meet growing demand.