Overview

Click to expand overview
US defence contractors are missing out on a global military boom that has boosted their European counterparts’ share prices as legislative deadlock in Washington While wars make the industrial military complex earn billions due to the sale of equipment, the average day-to-day investors avoid defense stocks in fear of further WASHINGTON (Reuters) -Sales of U.S. military equipment to foreign governments in 2025 rose 16% to a record $238 billion, the U.S. State Department said on Leading US military stocks experienced a $100 billion rout in market cap after the Israel and Palestine conflict. Investors sold their positions in US military stocks It hasn't been a great year for defense stocks. The likes of the RTX (RTX -0.73%), General Dynamics (GD -0.77%), and Lockheed Martin (LMT -0.25%) are all in Below, we highlight the top defense stocks for the fourth quarter with the best value, the highest growth potential, and the most momentum. All figures are as of Nov. 24

US Military Stocks Experience $100 Billion Wipeout in 2023: What Happened?

Leading US military stocks experienced a significant $100 billion rout in market capitalization in 2023, particularly after the Israel and Palestine conflict escalated. Investors, seemingly cautious, sold their positions in key US military stocks, contributing to a notable market downturn. While wars generally boost the industrial military complex through increased equipment sales, average day-to-day investors appear to be avoiding defense stocks, possibly fearing further geopolitical uncertainty.

It hasn't been a great year for defense stocks overall. Giants like RTX (RTX -0.73%), General Dynamics (GD -0.77%), and Lockheed Martin (LMT -0.25%) have all faced challenges. This contrasts sharply with the success of some European counterparts. US defence contractors are missing out on a global military boom that has boosted their European counterparts’ share prices as legislative deadlock in Washington hinders their performance.

Why the Dip? Factors Influencing US Defense Stock Performance

Several factors may be contributing to this underperformance. Legislative gridlock in Washington, as noted above, can significantly impact defense spending and future contracts. Investor sentiment is also a crucial driver, and anxieties surrounding international conflicts and ethical considerations can lead to divestment.

Interestingly, despite the stock market struggles, Sales of U.S. military equipment to foreign governments in 2025 rose 16% to a record $238 billion, the U.S. State Department said on. This divergence between robust sales figures and stock performance highlights the complexities of the defense industry and the influence of investor perception.

Top Defense Stocks to Watch (Q4 2023)

Despite the overall negative trend, opportunities remain in the defense sector. Below, we highlight the top defense stocks for the fourth quarter with the best value, the highest growth potential, and the most momentum. All figures are as of Nov. 24.

  • [Insert list of top defense stocks and related data here. Example: Stock Name (Ticker): Value Score, Growth Score, Momentum Score]

Investors should carefully consider their risk tolerance and investment goals before investing in defense stocks. While the sector can offer potential returns, it's also subject to significant volatility and influenced by global events and political decisions.

Top Sources

Related Articles