🛡️ Defense stocks didn't disappoint today

· 1d

🛡️ Defense stocks didn't disappoint today. Results from Lockheed Martin $LMT and RTX $RTX beat analyst expectations and both companies also raised their full-year outlook.

Lockheed is benefiting mainly from rising production of missile systems and air defense. Revenue rose 11% year-over-year to $20.1 billion and the company raised its full-year revenue and earnings outlook. Moreover, backlog reached a record $230 billion.

RTX also delivered strong results. Revenue rose 14% to $24.7 billion, the company raised its full-year outlook, and backlog grew to $289 billion. Both the Raytheon defense division and commercial aviation performed well.

The results of both companies just confirm that the defense sector continues to profit from high military spending, record backlogs and geopolitical tensions. The huge backlogs also provide very good revenue visibility for the next several years.

Do you hold any of these defense companies in your portfolio, or do you consider the current valuation already too high? How do you view defense stocks given the potential for escalation in the Middle East?

Vojtěch Šplíchal @vojtechsplichal 1d

I don't own a single share. I recently looked at $RHM.DE when it was trading around $950. But after a brief analysis, I reconsidered the investment. The defense industry, like others, isn't for me. Especially not at a time when budgets and investments in countries' defense are being played with.

Do you own any or are you watching one?

Martin Sedláček @martinsedlacek 1d

I own shares of $LMT, I bought them during last year's dip at values around $450. Given the nature of humanity and global tensions, the fighting won't stop anytime soon. I see that as the main growth signal, but I'm also watching their space division along with the American Golden Dome program.

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