Best defense stocks to invest in Q2 2025

The global defense sector continues to gain strength as geopolitical tensions, rising military budgets, and evolving technologies fuel long-term investment appeal. From advanced aerospace systems to AI-powered surveillance and drone solutions, defense stocks are becoming a strategic cornerstone in diversified portfolios.

Rheinmetall stands out for its dominant position in European land systems and ammunition supply. Next Vision Stabilized Systems is gaining traction with its cutting-edge imaging solutions for defense and security applications. Kongsberg, a leader in missile and naval systems, continues expanding globally through strong contracts and innovation.

With governments prioritizing modernization and autonomous defense capabilities, Q2 2025 is an ideal time to invest in this sector. These stocks offer both resilience in uncertain times and exposure to advanced technologies shaping the future of global security.

Roboforex R-Trader gives you access to over 10,000 stocks, ETFs, commodities, and crypto. All of the stocks mentioned in this article are available for purchase there.

Before we dive into each company, let`s take a look at how your investment would have performed if you had invested in top 10 stocks mentioned in this article 5 years ago.

Now, let`s take a closer look at each of the companies:

• Rheinmetall (RHM)

  Rheinmetall is a leading German defense and automotive technology company known for its advanced engineering and innovation. Established in 1889 and headquartered in Düsseldorf, Germany, Rheinmetall has grown from a munitions manufacturer to a global leader in defense systems and mobility solutions. The company operates across various markets, supplying cutting-edge technologies to governments and industries worldwide while maintaining a strong presence in Europe, the Americas, and Asia.

  Rheinmetall's core business focuses on two major sectors: defense and automotive. In the defense space, the company specializes in armored vehicle systems, weapons, ammunition, air defense systems, and electronic solutions designed for modern combat environments. On the automotive side, Rheinmetall develops high-performance components, including engine systems and emission-reduction technologies, to meet the needs of the evolving mobility sector. With its dual focus, Rheinmetall continues to drive innovation in security and sustainability.

  💡 Why invest in Rheinmetall?

  Several key factors make Rheinmetall an intriguing prospect for investors seeking exposure to the evolving defense and automotive landscapes:

  • Leading Defense Player: Rheinmetall holds a prominent position within the German defense industry, and ranks among the top five arms manufacturers in Europe. This leadership translates into a significant market share and brand recognition within the sector.
  • Diversification Through Automotive: Rheinmetall's presence in the automotive sector offers diversification, mitigating risk by not solely relying on defense spending. This dual-pronged approach provides stability and caters to a broader market.
  • Focus on Innovation: Across both defense and automotive sectors, Rheinmetall prioritizes research and development. They invest in cutting-edge technologies like future combat vehicles and emission reduction solutions, positioning them for future growth.
  • Strong Global Presence: Rheinmetall operates manufacturing facilities and maintains customer relationships around the world. This global reach allows them to capitalize on international markets and mitigate dependence on any single geographic region.

  🐌 Key considerations before investing in Rheinmetall

  While Rheinmetall navigates both the defense and automotive landscapes with its leadership position, diversification, and focus on innovation, there are challenges to consider before deploying your capital:

  • Geopolitical Uncertainty: Global political tensions and conflicts directly impact the demand for defense equipment. Geopolitical instability can lead to increased military spending, potentially benefiting Rheinmetall's defense sector, but also harbors risks like project delays or cancellations.
  • Scrutiny of Defense Spending: Public and political scrutiny of government spending on defense can lead to budget cuts, impacting Rheinmetall's defense sales and profitability. Monitoring political climates and defense spending trends is crucial.
  • Ethical Considerations: The nature of the defense industry raises ethical concerns for some investors. Carefully consider your own investment philosophy regarding companies involved in military technology.
  • Fluctuations in Automotive Industry: The automotive sector is susceptible to economic downturns and fluctuations in raw material costs. These factors can impact Rheinmetall's automotive sales and profitability. Staying informed about industry trends is vital.

  Final thoughts on Rheinmetall

  Rheinmetall's leadership in defense, established presence in automotive, focus on innovation, and global reach paint a potentially promising picture for long-term investors seeking exposure to both sectors. However, the geopolitical uncertainty, scrutiny of defense spending, ethical considerations, and fluctuations in the automotive industry necessitate a cautious approach. Thorough research, analysis of Rheinmetall's future plans in both defense and automotive sectors, and a clear understanding of your risk tolerance are crucial before joining this multifaceted investment expedition. Remember, navigating the intricate terrain of Rheinmetall stock requires both a discerning eye for global trends and a balanced perspective on potential challenges. Choose wisely, and your portfolio might find itself bolstered alongside the success story of Rheinmetall.

• Next Vision Stabilized Systems (NXSN)

  Next Vision Stabilized Systems is a cutting-edge technology company specializing in the development of advanced stabilized imaging systems for drones, robotics, and defense applications. Headquartered in Israel, the company was founded in 2009 with a mission to revolutionize the field of aerial and ground-based imaging. Over the years, Next Vision has become a trusted provider of high-performance gimbal systems, delivering precision and reliability to customers worldwide.

  The company's core business focuses on designing lightweight, stabilized camera systems that offer unparalleled image quality and functionality. These systems are widely used in surveillance, reconnaissance, search and rescue, and industrial inspections. Known for their technological innovation and user-friendly designs, Next Vision's products empower industries to operate in challenging environments while ensuring optimal visual performance.

  💡 Why invest in Next Vision Stabilized Systems?

  Next Vision's unique position in the micro gimbal camera market offers several potential advantages for investors seeking exposure to this emerging technology:

  • High-Growth Market: The demand for micro gimbal cameras is expected to grow significantly due to the increasing popularity of drones and other aerial platforms.
  • Focus on Niche Market: Their specialization in micro cameras allows them to cater to specific customer needs and potentially avoid competition from larger camera manufacturers.
  • Proven Track Record: Next Vision boasts a history of developing and commercializing field-proven micro gimbal cameras, demonstrating their technical expertise.
  • Focus on Low SWaP (Size, Weight, and Power): Their cameras prioritize small size, lightweight design, and efficient power consumption, making them ideal for drone applications.

  🐌 Key considerations before investing in Next Vision Stabilized Systems

  However, before investing in Next Vision Stabilized Systems, it's crucial to consider the potential challenges:

  • Limited Market Size: Compared to broader camera markets, the micro gimbal camera sector is still relatively small, limiting potential customer base and overall market share.
  • Competition: While they have a niche focus, established players in the broader camera industry might develop competing micro gimbal camera solutions.
  • Dependence on Drone Industry: The success of Next Vision is tied to the growth and adoption of drones, which could be impacted by regulations or safety concerns.
  • Technological Advancements: The micro gimbal camera space is rapidly evolving. Keeping pace with technological advancements will be essential for Next Vision to stay competitive.

  Final thoughts on Next Vision Stabilized Systems

  Next Vision's focus on a niche market, their proven track record, and the high-growth potential of the micro gimbal camera industry paint a promising picture for long-term investors seeking exposure to this emerging technology. However, the limited market size, potential for increased competition, dependence on the drone industry, and the need for continuous innovation necessitate careful consideration. Thorough research on Next Vision's product roadmap, their strategies for expanding their customer base, and a clear understanding of your risk tolerance are crucial before adding Next Vision Stabilized Systems to your portfolio. Remember, sometimes the biggest innovations come in small packages. Next Vision's story could be a niche addition to your investment journey.

• Kongsberg (KOZ)

  Kongsberg Gruppen is a leading Norwegian technology and defense company specializing in advanced systems for the defense, aerospace, maritime, and energy industries. Headquartered in Kongsberg, Norway, the company was founded in 1814, making it one of the oldest industrial enterprises in the country. Over its long history, Kongsberg Gruppen has evolved from a small weapons factory to a global leader in cutting-edge technology, serving both civilian and military markets.

  The company's core business revolves around delivering innovative solutions in areas such as defense systems, autonomous technologies, and maritime operations. Kongsberg's product portfolio includes precision-guided weapons, remote weapon stations, subsea robotics, and advanced simulation systems. With a strong commitment to sustainability and technological excellence, Kongsberg Gruppen supports its customers worldwide in tackling complex operational challenges in demanding environments.

  💡 Why invest in Kongsberg?

  Kongsberg Gruppen offers several compelling reasons to consider investing:

  • Diverse Revenue Streams: Kongsberg's strong presence in defense, maritime, and digital solutions reduces reliance on a single sector and enhances stability.
  • Innovation in Maritime Automation: The company leads in providing autonomous and digital solutions for the maritime industry, addressing increasing demand for efficiency and sustainability.
  • Strong Defense Portfolio: With advanced weapon systems and partnerships with NATO countries, Kongsberg is well-positioned to benefit from global defense spending.
  • Focus on Sustainability: Kongsberg integrates green technologies and energy-efficient systems into its product offerings, aligning with global sustainability goals.

  🐌 Key considerations before investing in Kongsberg

  However, prospective investors should weigh the following challenges:

  • Geopolitical Risks: As a defense contractor, Kongsberg is exposed to political and regulatory risks tied to defense spending and international relations.
  • High R&D Costs: The company's commitment to innovation requires significant investment in research and development, which can pressure margins.
  • Reliance on Key Markets: A substantial portion of Kongsberg's revenue comes from Europe, making it vulnerable to economic or political instability in the region.
  • Competitive Industry: Kongsberg faces competition from global giants in both the defense and maritime sectors, which may impact its market share.

  Final thoughts on Kongsberg

  Kongsberg Gruppen ASA is a technologically advanced and diversified company with strong positions in defense, maritime, and digital industries. Its focus on innovation, sustainability, and partnerships ensures relevance in a rapidly evolving market. However, investors should weigh geopolitical and economic risks alongside the company's strengths when considering it as an investment opportunity.

• DroneShield (ASX:DRO)

  DroneShield is an Australian publicly listed company specializing in counter-unmanned aerial system (C-UAS) technology. Founded in 2014, the company is headquartered in Sydney, Australia, with additional operations in the United States and the United Kingdom. DroneShield has rapidly expanded its global footprint, deploying its technologies across over 70 countries, including active conflict zones such as Ukraine and strategic areas like the U.S.-Mexico border.

  The company's core business focuses on developing and manufacturing advanced C-UAS solutions that integrate radio frequency sensing, artificial intelligence, machine learning, sensor fusion, and electronic warfare capabilities. DroneShield's product portfolio includes devices like the DroneGun Tactical and DroneGun Mk4, designed to detect, track, and neutralize unauthorized drones. These solutions are utilized by military, government, law enforcement, and critical infrastructure entities worldwide to protect against the growing threat of drone incursions.

  💡 Why invest in DroneShield?

  DroneShield offers several compelling reasons to consider investing:

  • Pioneering Position in a Growing Market: As the only publicly listed company globally with a pure-play focus on the counter-drone sector, DroneShield offers unique exposure to this rapidly expanding market.
  • Robust Financial Performance: In 2023, DroneShield achieved its first profitable year, reporting a profit after tax of $9.3 million and a cash balance of $57.9 million, indicating strong financial health.
  • Strategic Government Contracts: The company has secured significant contracts, including a $9.7 million order from a major Latin American military customer and $11.8 million in contracts within the Asia-Pacific region, enhancing revenue stability.
  • Emphasis on Domestic Manufacturing: By prioritizing local production, DroneShield reduces reliance on international supply chains, enhancing operational resilience amid global uncertainties.

  🐌 Key considerations before investing in DroneShield

  However, prospective investors should weigh the following challenges:

  • Dependence on Government Contracts: A substantial portion of DroneShield's revenue is derived from government and defense contracts, which can be subject to budgetary constraints and policy changes.
  • Regulatory and Compliance Risks: Operating in the defense sector entails navigating complex export controls and compliance requirements, which may impact the company's ability to fulfill certain contracts.
  • Market Competition: While a leader in counter-drone technology, DroneShield faces competition from other defense technology firms, necessitating continuous innovation to maintain its market position.
  • Supply Chain Vulnerabilities: Despite efforts to source locally, certain critical components like microchips and batteries are not produced domestically, potentially exposing the company to supply chain disruptions.

  Final thoughts on DroneShield

  DroneShield Limited stands out as a key player in the burgeoning counter-drone industry, offering innovative solutions to address emerging security threats. Its strong financial performance, strategic contracts, and focus on domestic manufacturing position it favorably for future growth. However, potential investors should consider the company's reliance on government contracts, regulatory challenges, and supply chain dependencies when evaluating investment opportunities.

• Norbit (4NK)

  Norbit is a Norwegian technology company specializing in intelligent solutions for maritime, defense, and industrial applications. Founded in 1995, the company is headquartered in Trondheim, Norway. With a strong focus on innovation, Norbit has developed a diverse portfolio of high-tech products catering to global markets.

  The company's core business revolves around three main segments: Oceans, Connectivity, and Product Innovation & Realization. In the Oceans division, Norbit provides advanced sonar and hydrographic systems for subsea mapping and surveillance. Its Connectivity segment focuses on wireless communication solutions, including smart tracking and monitoring technologies. Meanwhile, the Product Innovation & Realization segment supports industrial clients with customized electronics and sensor solutions. Through these divisions, Norbit continues to drive technological advancements in demanding industries worldwide.

  💡 Why invest in Norbit?

  Norbit ASA offers several compelling reasons to consider investing:

  • Diverse Business Segments: Operates across multiple high-tech industries, reducing reliance on a single revenue stream.
  • Strong R&D Focus: Continuous investment in research and development drives innovation and competitive advantages.
  • Growing Maritime Technology Market: Expanding demand for sonar and monitoring solutions benefits its Oceans division.
  • Global Expansion Strategy: Increasing international presence supports long-term growth opportunities.

  🐌 Key considerations before investing in Norbit

  However, prospective investors should weigh the following challenges:

  • Market Dependence: Relies on specific industries, such as maritime and infrastructure, which are subject to economic fluctuations.
  • Competition from Larger Players: Faces competition from well-established technology and defense firms in its key markets.
  • Supply Chain Risks: Dependence on electronic components and specialized materials could lead to production delays and cost increases.
  • Regulatory and Political Risks: Exposure to government contracts and regulations may impact revenue stability.

  Final thoughts on Norbit

  Norbit ASA is a promising industrial technology company with a strong focus on innovation and diversified revenue streams across maritime, infrastructure, and IoT markets. While it benefits from R&D investments and global expansion, challenges such as market dependency, competition, and regulatory risks should be considered. Investors looking for exposure to specialized technology sectors may find Norbit an intriguing long-term opportunity.

• Palantir (PLTR)

  Palantir Technologies is a software company specializing in big data analytics, artificial intelligence, and machine learning solutions for government and commercial clients. Founded in 2003 by Peter Thiel, Alex Karp, and others, the company is headquartered in Denver, Colorado. Palantir initially developed its technology to assist U.S. intelligence agencies in counterterrorism efforts and has since expanded into various industries, including healthcare, finance, and manufacturing.

  The company's core business revolves around its data integration and analysis platforms, Palantir Gotham and Palantir Foundry. Gotham is primarily used by government and defense agencies for intelligence gathering and national security, while Foundry helps commercial organizations optimize operations through data-driven decision-making. With a focus on handling complex and sensitive datasets, Palantir continues to be a key player in the field of advanced analytics and enterprise software solutions.

  Palantir financial statements

  Analysts recommendation: 2.81

  Financial Health

  • Return on assets (ROA): 8.51%
  • Return on equity (ROE): 10.9%
  • Return on investment (ROI): 8.89%

  Profitability

  • Gross margin: 80.25%
  • Operating margin: 10.83%
  • Net profit margin: 16.13%

  Growth

  • EPS (past 5 years): N/A
  • EPS (current): 0.19
  • EPS estimate (next quarter): 0.13
  • EPS growth (this year): 32.46%
  • EPS growth (next year): 25.27%
  • EPS growth (next 5 years): 30.16%
  • EPS growth (quarter-over-quarter): -21.21%
  • Sales growth (past 5 years): 31.48%
  • Sales growth (quarter-over-quarter): 36.03%

  💡 Why invest in Palantir?

  Palantir offers several compelling reasons to consider investing:

  • Strong Government Contracts: The company secures multi-year contracts with U.S. government agencies, ensuring a stable and recurring revenue stream.
  • Cutting-Edge AI and Data Analytics: Palantir's AI-driven platforms offer advanced data processing capabilities that are in high demand across industries.
  • Expanding Commercial Business: While historically reliant on government contracts, the company is rapidly growing its presence in commercial sectors, diversifying its revenue sources.
  • High Barriers to Entry: Palantir's proprietary technology and deep integration with clients create strong competitive advantages and customer retention.

  🐌 Key considerations before investing in Palantir

  However, prospective investors should weigh the following challenges:

  • Profitability Concerns: The company has struggled with consistent profitability due to high operating expenses and significant investments in growth.
  • Reliance on Government Contracts: A large portion of revenue still comes from government deals, making it vulnerable to shifts in defense budgets and policies.
  • Stock Volatility: As a high-growth tech stock, Palantir's share price is subject to significant swings based on market sentiment and earnings performance.
  • Concerns Over Data Privacy and Ethics: The company's involvement in surveillance and defense projects has raised ethical concerns, potentially impacting public perception and client relationships.

  Final thoughts on Palantir

  Palantir is a leading force in AI-driven data analytics, with strong government partnerships, growing commercial adoption, and high-tech innovation fueling its expansion. Its ability to process vast datasets and provide mission-critical intelligence makes it a valuable player in multiple industries. However, profitability challenges, reliance on government contracts, and ethical concerns present risks that investors should carefully consider.

• Howmet Aerospace (HWM)

  Howmet Aerospace is a leading global manufacturer of advanced engineered solutions for the aerospace and transportation industries. Founded in 1888 as part of the Aluminum Company of America (Alcoa), Howmet became an independent entity in 2020 and is headquartered in Pittsburgh, Pennsylvania. With a strong heritage of innovation, the company serves major aerospace manufacturers and other industrial sectors, delivering lightweight and high-performance components critical to modern technologies.

  The core business of Howmet Aerospace focuses on producing precision-engineered metal components, including jet engine parts, structural components, and fasteners for commercial and military aircraft. The company also specializes in titanium and aluminum products for the aerospace and automotive industries, enhancing fuel efficiency and performance. By leveraging cutting-edge technology and a commitment to quality, Howmet Aerospace continues to be a trusted partner in delivering solutions that meet the rigorous demands of its global customers.

  Howmet Aerospace financial statements

  Analysts recommendation: 1.61

  Financial Health

  • Return on assets (ROA): 11.03%
  • Return on equity (ROE): 26.89%
  • Return on investment (ROI): 14.45%

  Profitability

  • Gross margin: 27.54%
  • Operating margin: 22.42%
  • Net profit margin: 15.52%

  Growth

  • EPS (past 5 years): 22.24%
  • EPS (current): 2.81
  • EPS estimate (next quarter): 0.77
  • EPS growth (this year): 21.46%
  • EPS growth (next year): 20.83%
  • EPS growth (next 5 years): 19.36%
  • EPS growth (quarter-over-quarter): 34.99%
  • Sales growth (past 5 years): 2.34%
  • Sales growth (quarter-over-quarter): 9.24%

  💡 Why invest in Howmet Aerospace?

  Several key factors make Howmet an attractive prospect for investors seeking exposure to the ever-evolving aerospace sector:

  • Leader in Engineered Metal Solutions: Howmet Aerospace stands as a recognized leader in the development and production of engineered metal solutions for the commercial aerospace industry. This leadership position translates into a significant market share and brand recognition within the sector.
  • Focus on Innovation and Sustainability: Howmet prioritizes research and development, constantly innovating to create lighter, stronger, and more fuel-efficient jet engine components. This focus aligns with the industry's push for sustainable air travel, positioning Howmet for future growth.
  • Strong Customer Relationships: Howmet fosters long-term relationships with major aircraft manufacturers, ensuring a steady stream of demand for its products. This customer focus bodes well for the company's future profitability.
  • Global Presence: Howmet operates manufacturing facilities strategically located around the world, allowing it to cater to the needs of a global clientele and mitigate risks associated with any single geographic market.

  🐌 Key considerations before investing in Howmet Aerospace

  While Howmet Aerospace navigates the dynamic aerospace landscape with its leadership position, focus on innovation, and strong customer relationships, there are some challenges to consider before joining this high-flying investment opportunity:

  • Vulnerability to Economic Downturns: Economic slowdowns can lead to decreased airline passenger traffic and reduced demand for new aircraft, potentially impacting Howmet's sales and profitability. Monitoring economic indicators is crucial for understanding potential market fluctuations.
  • Reliance on Major Aircraft Manufacturers: Howmet's fortunes are tied to the success of major aircraft manufacturers. Delays in production schedules or cancellations of aircraft programs can significantly impact Howmet's revenue streams. Diversifying its customer base beyond commercial aerospace could mitigate this risk.
  • Competition Heats Up: The aerospace manufacturing sector is a competitive landscape, with established players and emerging companies vying for market share. Staying informed about industry trends and Howmet's strategies for maintaining its competitive edge is vital.
  • Fluctuations in Raw Material Costs: Howmet's production processes rely heavily on various metals. Fluctuations in the prices of these raw materials can impact the company's profit margins. Analyzing Howmet's strategies for managing these costs is key.

  Final thoughts on Howmet Aerospace

  Howmet Aerospace's leadership in engineered metal solutions, focus on innovation and sustainability, strong customer relationships, and global presence paint a potentially promising picture for long-term investors seeking exposure to the aerospace sector. However, the vulnerability to economic downturns, reliance on major aircraft manufacturers, rising competition, and fluctuations in raw material costs necessitate a cautious approach. Thorough research, analysis of Howmet's future plans and the global aerospace landscape, and a clear understanding of your risk tolerance are crucial before joining this aerospace expedition. Remember, navigating the intricate terrain of aerospace manufacturing stocks requires both a discerning eye for industry trends and a balanced perspective on potential challenges. Choose wisely, and your portfolio might just find itself soaring alongside the success story of Howmet Aerospace.

• Saab AB (OMXSTO:SAAB_B)

  Saab AB is a Swedish defense and aerospace company specializing in fighter aircraft, naval systems, and electronic warfare technologies. The company was founded in 1937 and is headquartered in Stockholm, Sweden. Originally established as an aircraft manufacturer, Saab has since evolved into a global leader in advanced defense and security solutions.

  Saab's core business includes the development and production of military aircraft, such as the Gripen fighter jet, as well as submarines, radar systems, and missile defense technologies. The company also provides electronic warfare solutions, surveillance systems, and cybersecurity services to military and government clients worldwide. With a strong focus on innovation and sustainability, Saab continues to play a crucial role in strengthening defense capabilities across the globe.

  💡 Why invest in Saab AB?

  Saab AB offers several compelling reasons to consider investing:

  • Strong Defense Spending Tailwinds: Global military budgets continue to rise, particularly in Europe, where defense modernization is a priority.
  • Gripen Fighter Jet Demand: The Gripen is a cost-effective and technologically advanced alternative to U.S. and European competitors, securing international defense contracts.
  • Diversified Defense Portfolio: Saab's expertise spans air, land, and naval defense, reducing reliance on any single product segment.
  • Government and NATO Partnerships: Close ties with European governments and growing NATO collaborations enhance long-term contract stability.

  🐌 Key considerations before investing in Saab AB

  However, prospective investors should weigh the following challenges:

  • Highly Competitive Industry: The defense sector is dominated by major global players like Lockheed Martin, Boeing, and BAE Systems, making contract wins challenging.
  • Dependence on Government Contracts: Revenue relies heavily on military spending, which can be subject to political shifts and budget constraints.
  • Regulatory and Export Risks: International arms sales face strict regulations, geopolitical concerns, and potential trade restrictions.
  • Cyclical Nature of Defense Procurement: Large-scale defense contracts take years to secure and execute, leading to revenue fluctuations.

  Final thoughts on Saab AB

  Saab AB is a key player in the global defense industry, offering cutting-edge fighter jets, naval systems, and electronic warfare solutions. Its diversified portfolio and increasing defense budgets provide strong growth potential. However, intense competition, reliance on government contracts, and regulatory challenges should be considered when evaluating an investment in the company.

• Leonardo DRS (DRS)

  Leonardo DRS is a prominent U.S.-based defense contractor specializing in advanced technology solutions for military and government customers. Founded in 1969 and headquartered in Arlington, Virginia, Leonardo DRS has established itself as a trusted partner to the U.S. Department of Defense and allied nations. As a subsidiary of the Italian aerospace and defense giant Leonardo S.p.A., the company combines global expertise with localized innovation to deliver cutting-edge systems and services.

  The core business of Leonardo DRS centers around providing mission-critical solutions in areas such as sensor technologies, electronic warfare, intelligence systems, and power and propulsion systems. The company is also a leader in producing next-generation military communication systems and infrared technologies. By focusing on innovation and operational excellence, Leonardo DRS plays a vital role in enhancing defense capabilities and addressing the evolving needs of modern warfare.

  Leonardo DRS financial statements

  Analysts recommendation: 1.78

  Financial Health

  • Return on assets (ROA): 5.08%
  • Return on equity (ROE): 8.73%
  • Return on investment (ROI): 7.19%

  Profitability

  • Gross margin: 22.08%
  • Operating margin: 9.31%
  • Net profit margin: 6.59%

  Growth

  • EPS (past 5 years): 9%
  • EPS (current): 0.79
  • EPS estimate (next quarter): 0.17
  • EPS growth (this year): 14.33%
  • EPS growth (next year): 16.4%
  • EPS growth (next 5 years): 13.71%
  • EPS growth (quarter-over-quarter): 18.82%
  • Sales growth (past 5 years): 3.78%
  • Sales growth (quarter-over-quarter): 5.94%

  💡 Why invest in Leonardo DRS?

  Dominant niche, innovation arsenal, governmental trust, and global footprint make DRS a strategic force in the defense investment landscape.

  • Dominant Niche: DRS reigns supreme in naval systems, ground combat, and global satellite networks, offering unparalleled expertise and market share in these crucial defense sectors.
  • Innovation Arsenal: From cutting-edge electro-optical systems to hypersonic technology, DRS invests heavily in R&D, ensuring its arsenal remains future-proof and competitive.
  • Governmental Trust: Deeply embedded within U.S. and allied defense ecosystems, DRS boasts a track record of reliable collaboration and delivery, translating to consistent contracts and revenue streams.
  • Global Footprint: With operations spanning continents, DRS leverages its vast network to tap into diverse defense needs and unlock international growth opportunities.

  🐌 Key considerations before investing in Leonardo DRS

  Valuation concerns, cyclical industry, technological disruption, and geopolitical turmoil are potential roadblocks for DRS investors.

  • Valuation Concerns: Like many established defense players, DRS's stock currently sits near all-time highs, demanding a cautious approach due to potentially limited immediate gains.
  • Cyclical Industry: Defense spending ebbs and flows with geopolitical tides, exposing DRS to potential downturns and necessitating careful analysis of future market projections.
  • Technological Disruption: Emerging technologies and agile startups can disrupt the defense landscape, requiring DRS to constantly adapt and innovate to maintain its competitive edge.
  • Geopolitical Turmoil: International tensions and trade disruptions can impact DRS's supply chains and operations, adding an element of uncertainty to its future performance.

  Final thoughts on Leonardo DRS

  Leonardo DRS's dominance in niche defense sectors, unwavering focus on innovation, and close ties to governments paint a potentially rewarding picture for long-term investors. However, near-peak valuation, the cyclical nature of the defense industry, the threat of disruption, and geopolitical uncertainties warrant a measured approach. Thorough research, analysis of DRS's future plans and market dynamics, and a clear understanding of your risk tolerance are crucial before entering this strategic battlefield. Remember, navigating the intricate terrain of defense stocks requires keen strategic vision and a disciplined investment spirit. Choose wisely, and your portfolio might just emerge victorious amidst the complex tides of global security.

• Axon Enterprise (AXON)

  Axon is a leading public safety technology company known for its innovative solutions designed to enhance law enforcement and public safety operations. Founded in 1993 and headquartered in Scottsdale, Arizona, Axon began its journey as a pioneer in developing less-lethal weapons, such as its flagship TASER devices. Over the years, the company has expanded its focus to include a comprehensive ecosystem of hardware, software, and artificial intelligence tools for first responders and public safety agencies worldwide.

  The company's core business revolves around providing cutting-edge technologies that improve transparency, accountability, and efficiency in law enforcement. Axon's offerings include body-worn cameras, digital evidence management platforms, and advanced AI-driven tools for data analysis and real-time decision-making. By integrating hardware and cloud-based solutions, Axon empowers public safety organizations to build trust within their communities while delivering safer and more effective outcomes.

  Axon Enterprise financial statements

  Analysts recommendation: 1.47

  Financial Health

  • Return on assets (ROA): 9.51%
  • Return on equity (ROE): 19.1%
  • Return on investment (ROI): 12.34%

  Profitability

  • Gross margin: 59.51%
  • Operating margin: 2.82%
  • Net profit margin: 18.05%

  Growth

  • EPS (past 5 years): 218.25%
  • EPS (current): 4.78
  • EPS estimate (next quarter): 1.28
  • EPS growth (this year): 2.65%
  • EPS growth (next year): 22.3%
  • EPS growth (next 5 years): 13.35%
  • EPS growth (quarter-over-quarter): 122.28%
  • Sales growth (past 5 years): 31.5%
  • Sales growth (quarter-over-quarter): 33.09%

  💡 Why invest in Axon Enterprise?

  Amidst every crackling spark from a Taser and every click of a body camera, Axon Enterprise unfolds a narrative of technological innovation and public safety that beckons investors. This controversial leader in law enforcement tech presents a complex yet compelling story, with reasons to invest weaving through dominant market share, tech-driven growth, recurring revenue streams, and potential social impact – a fusion of opportunities for those intrigued by the intersection of technology and public service.

  • Market Dominance: Boasting immense reach and influence, Axon reigns supreme in body cameras and Tasers, securing reliable revenue streams and a formidable competitive edge.
  • Tech-Driven Growth: Beyond its iconic weaponry, aggressive investments in cloud-based evidence management and data analytics position Axon at the forefront of police tech, unlocking promising future growth avenues.
  • Recurring Revenue Stream: Predictable and reliable, Axon's subscription-based software and cloud services offer investors a bedrock for long-term gains.
  • Social Impact Potential: Playing a crucial role in police accountability and transparency, Axon's technology aligns with investors seeking socially responsible investment opportunities.

  🐌 Key considerations before investing in Axon Enterprise

  With the ethereal hum of technological advancement, Axon Enterprise invites investors to contemplate the duality of opportunity and challenge. This tech titan, a pivotal player in law enforcement tech, raises concerns that echo through ethical controversies, market saturation warnings, valuation considerations, and a competitive landscape that demands constant innovation and adaptation.

  • Ethical Controversy: Axon's Tasers, while popular, are subject to ongoing concerns about excessive force and racial profiling. Ethical considerations and potential legal challenges could impact the company's reputation and growth.
  • Market Saturation: The law enforcement tech market is expected to slow down in the coming years, potentially limiting Axon's future expansion potential. Diversification into other security sectors might be necessary.
  • Valuation Considerations: Similar to other established tech names, Axon's stock currently trades near all-time highs, potentially limiting immediate significant gains. A wait-and-see approach might be prudent.
  • Competitive Landscape: Emerging players and tech giants might enter the law enforcement tech space, threatening Axon's market dominance. Constant innovation and adaptation will be key to maintaining its competitive edge.

  Final thoughts on Axon Enterprise

  Axon's technological prowess and dominant market position offer undeniable allure for investors. However, ethical concerns, a slowing market, potential valuation hurdles, and growing competition paint a picture of risk alongside potential reward. Careful research, analysis of Axon's future plans, and a clear understanding of your own risk tolerance are crucial before deciding if this tech titan deserves a place in your portfolio. Remember, navigating the often-charged landscape of law enforcement tech demands a measured approach and a discerning eye. Choose wisely, and your investment journey might just spark with both profit and positive impact.

• Hensoldt (HAG)

  Hensoldt is a German defense technology company specializing in sensor solutions, radar systems, and electronic warfare technologies. Founded in 2017 as a spin-off from Airbus Defence and Space, the company is headquartered in Taufkirchen, Germany. With a strong presence in the global defense and security sector, Hensoldt provides advanced surveillance and reconnaissance systems for military and civilian applications.

  The company's core business revolves around the development of high-performance radar, optronics, and avionics systems. Hensoldt supplies critical technologies for fighter aircraft, naval vessels, and ground-based defense systems, enhancing situational awareness and threat detection. Additionally, the company is investing in cybersecurity and AI-driven defense solutions, positioning itself as a key innovator in modern security and surveillance technologies.

  💡 Why invest in Hensoldt?

  Hensoldt offers several compelling reasons to consider investing:

  • Strong Defense Industry Position: A key supplier of advanced sensor and radar systems to European and NATO defense programs.
  • Growing Defense Budgets: Increasing military spending in Europe and worldwide supports long-term demand for its products and services.
  • Technological Innovation: Focuses on cutting-edge defense electronics, cybersecurity, and artificial intelligence-driven surveillance solutions.
  • Strategic Partnerships: Collaborates with major defense contractors and government agencies, securing long-term contracts and stable revenue streams.

  🐌 Key considerations before investing in Hensoldt

  However, prospective investors should weigh the following challenges:

  • Dependence on Government Contracts: A large portion of revenue comes from defense contracts, making it vulnerable to political and budgetary changes.
  • Geopolitical Risks: Exposure to international defense markets subjects the company to export restrictions, regulatory hurdles, and shifting alliances.
  • Competitive Industry: Faces competition from larger defense firms such as Thales, Leonardo, and Raytheon Technologies.
  • Market Volatility: As a relatively new publicly traded company, its stock price can be affected by defense sector fluctuations and investor sentiment.

  Final thoughts on Hensoldt

  Hensoldt is a key player in the European defense technology sector, benefiting from rising defense budgets, strong industry partnerships, and technological expertise. However, its reliance on government contracts, geopolitical uncertainties, and competitive pressures pose investment risks. Investors seeking exposure to the growing defense and security industry should weigh these factors carefully.

• Dassault Aviation (TURQUOISE:AMP)

  Dassault Aviation is a French aerospace company known for its high-performance military and business aircraft, including the Rafale fighter jet and Falcon business jets. The company was founded in 1929 by Marcel Dassault and is headquartered in Saint-Cloud, France. With decades of expertise, Dassault has established itself as a leader in both defense and civilian aviation.

  Dassault Aviation's core business revolves around the design, development, and production of advanced military aircraft, such as the Rafale, a multi-role combat jet used by several air forces worldwide. In addition, the company manufactures the Falcon series of business jets, known for their luxury, efficiency, and cutting-edge avionics. Dassault is also deeply involved in aerospace innovation, focusing on next-generation fighter jets, unmanned systems, and digital flight technologies to maintain its position as a global aerospace leader.

  💡 Why invest in Dassault Aviation?

  Dassault Aviation offers several compelling reasons to consider investing:

  • Strong Military Contracts: The Rafale fighter jet continues to secure international defense deals, boosting revenue and long-term growth.
  • Resilient Business Jet Market: The Falcon series benefits from rising demand in the private aviation sector, particularly among high-net-worth individuals and corporations.
  • Cutting-Edge Aerospace Technology: Dassault is known for its innovation in avionics, stealth capabilities, and digital engineering, strengthening its competitive edge.
  • Global Defense Partnerships: Collaborations with NATO allies and strategic partnerships enhance its geopolitical influence and contract stability.

  🐌 Key considerations before investing in Dassault Aviation

  However, prospective investors should weigh the following challenges:

  • High Dependence on Government Contracts: A significant portion of revenue relies on defense spending, which can be influenced by political and budgetary shifts.
  • Intense Industry Competition: Faces strong competition from global aerospace giants like Lockheed Martin, Boeing, and Airbus in both military and business aviation.
  • Cyclical Demand for Business Jets: Economic downturns can impact corporate and private aviation spending, affecting Falcon jet sales.
  • Regulatory and Export Challenges: International arms sales and aircraft exports are subject to stringent regulations and geopolitical risks.

  Final thoughts on Dassault Aviation

  Dassault Aviation is a powerhouse in both military and business aviation, with its Rafale fighter jet and Falcon business jets leading their respective markets. Its innovation-driven approach and strong defense contracts provide solid growth opportunities. However, reliance on government contracts, industry competition, and regulatory risks should be factored into any investment decision.

• Thales (GETTEX:CSF)

  Thales is a global leader in advanced technologies, specializing in aerospace, defense, security, and digital identity solutions. Founded in 2000 and headquartered in Paris, France, the company has a rich history rooted in the merger of Thomson-CSF and Racal Electronics. With operations in over 68 countries and a workforce of more than 80,000 employees, Thales delivers innovative solutions to governments, businesses, and organizations worldwide.

  The company's core business focuses on developing technologies that enhance safety, security, and efficiency across various sectors. Thales is renowned for its contributions to air traffic management, cybersecurity, defense systems, and space technologies. By investing heavily in research and development, the company continues to drive innovation in areas like artificial intelligence, big data, and quantum technology, helping its clients address complex challenges in an ever-evolving global landscape.

  💡 Why invest in Thales?

  Several factors make Thales an attractive investment in the technology sector:

  • Technological Leader: Thales boasts a strong presence across aerospace, defense, transportation, and security, offering a diversified portfolio of innovative solutions.
  • Global Reach: They operate in over 100 countries, making their life-saving technologies accessible to a global population.
  • Focus on R&D: Their commitment to research and development fuels a steady pipeline of innovative products, ensuring future growth and addressing unmet needs.

  🐌 Key considerations before investing in Thales

  The technology sector presents its own set of challenges:

  • High Development Costs: Research and development for new technologies can be expensive and time-consuming, with no guarantee of success.
  • Rapid Technological Change: The constant evolution of technology can quickly render existing products obsolete, requiring continuous adaptation.
  • Geopolitical Dependence: Defense spending and international relations can impact Thales' business depending on global security landscapes.

  Final thoughts on Thales

  Thales' strong market position, diverse portfolio, and focus on R&D paint a potentially promising picture for long-term investors seeking exposure to the ever-evolving technology sector. However, the high costs of development, rapid technological shifts, and geopolitical dependence necessitate a cautious approach. Thorough research, analysis of Thales' innovation pipeline and strategies for navigating challenges, and a clear understanding of your risk tolerance are crucial before adding Thales to your portfolio. Remember, the future is shaped by technology. Thales' ability to deliver cutting-edge solutions will be key to its continued success. Choose wisely, and your portfolio might find itself at the forefront of innovation alongside the Thales story.

• Indra Sistemas (BME:IDR)

  Indra Sistemas, S.A., commonly known as Indra, is a Spanish multinational company headquartered in Alcobendas, Madrid. Established in 1992 through the merger of Ceselsa and Inisel, Indra has evolved into a leading global technology and consulting firm. As of 2024, the company reported revenues of €4.843 billion and employed over 60,000 professionals, with a presence in 50 countries and commercial operations in more than 150 nations.

  Indra's core business encompasses a diverse range of sectors, including defense, air traffic management, transport, energy, telecommunications, financial services, and the public sector. The company offers comprehensive solutions that span from consultancy and project development to systems integration and outsourcing of IT and business processes. Notably, Indra is a key player in air traffic control systems, managing approximately one-third of the world's air traffic through its technologies. Additionally, the company is involved in defense electronics, simulation systems, and ticketing solutions for various rapid transit systems worldwide.

  💡 Why invest in Indra Sistemas?

  Indra Sistemas offers several compelling reasons to consider investing:

  • Diversified Portfolio: Indra operates across multiple sectors, reducing dependency on any single market and enhancing resilience against industry-specific downturns.
  • Global Presence: With operations in over 150 countries, Indra benefits from a broad international footprint, allowing access to diverse markets and revenue streams.
  • Technological Expertise: The company's involvement in critical areas such as air traffic management and defense electronics positions it as a leader in high-demand technological solutions.
  • Strategic Acquisitions: Recent moves, such as the acquisition of a majority stake in satellite operator Hispasat, demonstrate Indra's commitment to expanding its capabilities and market reach.

  🐌 Key considerations before investing in Indra Sistemas

  However, prospective investors should weigh the following challenges:

  • Regulatory Challenges: Operating in sectors like defense and air traffic management subjects Indra to stringent regulations, which can impact operational flexibility and profitability.
  • Market Competition: The company faces intense competition from both established players and emerging firms in the technology and defense industries, potentially affecting market share and margins.
  • Dependence on Government Contracts: A significant portion of Indra's revenue is derived from government contracts, making it susceptible to changes in public spending and policy decisions.
  • Reputational Risks: Past involvement in controversies, such as fines for cartel activities, may impact the company's reputation and stakeholder trust.

  Final thoughts on Indra Sistemas

  Indra Sistemas stands out as a prominent player in the global technology and consulting arena, with a diversified portfolio and extensive international presence. Its expertise in critical sectors and strategic growth initiatives underscore its potential for sustained success. However, potential investors should carefully consider the regulatory environment, competitive landscape, reliance on government contracts, and historical reputational issues when evaluating investment opportunities with Indra.

• BAE Systems (BA.)

  BAE Systems is a leading global defense, aerospace, and security company, providing advanced technologies and services to governments and commercial customers worldwide. Founded in 1999 through the merger of British Aerospace and Marconi Electronic Systems, the company is headquartered in Farnborough, United Kingdom. With operations spanning over 40 countries, BAE Systems is a key player in the global defense industry, known for its commitment to innovation and engineering excellence.

  The core business of BAE Systems focuses on designing, developing, and manufacturing advanced defense systems, including naval ships, combat vehicles, military aircraft, and cybersecurity solutions. The company is a major supplier of electronic warfare and intelligence systems, as well as guided weaponry and ammunition. By leveraging cutting-edge technologies and strategic partnerships, BAE Systems plays a pivotal role in enhancing national security and enabling military forces to address evolving global challenges.

  💡 Why invest in BAE Systems?

  Several key factors make BAE Systems an attractive prospect for investors seeking exposure to the ever-evolving defense and aerospace sectors:

  • Global Defense Leader: BAE Systems stands as the largest defense contractor in Europe and one of the top players worldwide. This leadership position translates into a significant market share and brand recognition within the global defense industry.
  • Focus on Advanced Technology: BAE prioritizes research and development, constantly innovating in areas like fighter jets, cyber defense, and unmanned aerial vehicles (UAVs). This focus on cutting-edge technology ensures BAE remains at the forefront of defense capabilities.
  • Diversified Portfolio: BAE doesn't limit itself to a single area of defense. It offers a comprehensive suite of products and services across air, land, sea, and cyber domains, mitigating risk by catering to various defense needs.
  • Strong Customer Relationships: BAE fosters long-term relationships with government agencies and armed forces around the world, ensuring a steady stream of demand for its products and services. This customer focus bodes well for the company's future profitability.

  🐌 Key considerations before investing in BAE Systems

  While BAE Systems navigates the dynamic defense landscape with its leadership position, focus on innovation, and strong customer relationships, there are some challenges to consider before enlisting in this investment opportunity:

  • Geopolitical Uncertainty: Global political tensions and conflicts directly impact the demand for defense equipment. Geopolitical instability can lead to increased military spending, potentially benefiting BAE, but also harbors risks like project delays or cancellations.
  • Scrutiny of Defense Spending: Public and political scrutiny of government spending on defense can lead to budget cuts, impacting BAE's sales and profitability. Monitoring political climates and defense spending trends is crucial.
  • Ethical Considerations: The nature of the defense industry raises ethical concerns for some investors. Carefully consider your own investment philosophy regarding companies involved in military technology.
  • Competition Heats Up: The defense sector is a competitive landscape, with established players and emerging companies vying for government contracts. Staying informed about industry trends and BAE's strategies for maintaining its competitive edge is vital.

  Final thoughts on BAE Systems

  BAE Systems' leadership position in the defense sector, focus on innovation, diversified portfolio, and strong customer relationships paint a potentially promising picture for long-term investors seeking exposure to the defense and aerospace industries. However, the geopolitical uncertainty, scrutiny of defense spending, ethical considerations, and rising competition necessitate a cautious approach. Thorough research, analysis of BAE's future plans and the global defense landscape, and a clear understanding of your risk tolerance are crucial before joining this military technology expedition. Remember, navigating the intricate terrain of defense contractor stocks requires both a discerning eye for geopolitical trends and a balanced perspective on potential challenges. Choose wisely, and your portfolio might just find itself fortified alongside the success story of BAE Systems.

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