Best defense stocks to invest in 2026

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.

Next Vision Stabilized Systems is gaining traction with advanced stabilized imaging and electro-optical solutions for drones and defense platforms, providing critical surveillance capabilities to military and security customers worldwide. Aryt Industries specializes in electronic fuses and detonators for artillery and aerospace applications, delivering precision fuze electronics and safety-critical systems that meet stringent military certification standards. Rheinmetall stands out for its dominant position in European land systems and ammunition supply, delivering proven armored vehicles and munitions that support NATO readiness and long-term modernization programs.

With governments prioritizing modernization and autonomous defense capabilities, 2026 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.

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

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

  • Next Vision Stabilized Systems (TA:NXSN)

    Next Vision Stabilized Systems is an Israeli defense technology company specializing in imaging and surveillance systems for military drones, defense platforms, and security applications. Founded in 2010 and headquartered in Israel, the company is a leading provider of gimbal systems and electro‑optical solutions for defense contractors and military organizations. The company has demonstrated strong growth in defense contracts, especially in imaging technologies for surveillance, reconnaissance, and military tactical operations.

    Its portfolio includes lightweight stabilized cameras for drones, electro‑optical payloads for defense platforms, border surveillance systems, and specialized imaging solutions for military applications. Its products support defense operations including reconnaissance, tactical surveillance, border monitoring, and security systems used by defense forces and allied nations across key regions. With rising focus on unmanned systems and advanced surveillance, Next Vision is positioned to benefit from modernization programs and demand for sophisticated imaging in defense.

    Next Vision Stabilized Systems financial statements

    Analysts recommendation: N/A

    Financial Health

    • Return on assets (ROA): 15.66%
    • Return on equity (ROE): 25.65%
    • Return on investment (ROI): N/A

    Profitability

    • Gross margin: 71.63%
    • Operating margin: 59.82%
    • Net profit margin: 59.53%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 3.28
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 50.3%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 62.3%

    💡 Why invest in Next Vision Stabilized Systems?

    NVSS delivers stabilized imaging for military drones and defense platforms, enabling critical reconnaissance and surveillance:

    • Defense Imaging Leadership: Next Vision leads in lightweight stabilized imaging systems for military drones and defense platforms, empowering specialized capabilities that command premium pricing in defense markets and secure advantage.
    • Military Modernization Growth: The company benefits from increasing global defense spending on unmanned systems, advanced surveillance technologies, and military modernization programs driven by evolving security threats globally today.
    • Israeli Defense Expertise: Next Vision leverages Israel`s renowned defense technology expertise and established relationships with international defense contractors, providing access to global military markets worldwide today, globally.
    • Specialized Technology Moat: The company`s expertise in electro‑optical systems, gimbal stabilization, and military‑grade imaging creates significant barriers to entry and competitive advantages in defense surveillance for allied customers.

    🐌 Key considerations before investing in Next Vision Stabilized Systems

    NVSS faces defense budget dependence, niche market limits, competition, and scale constraints requiring disciplined execution:

    • Defense Budget Dependency: Heavy reliance on military spending makes the company vulnerable to defense budget cuts, changing procurement priorities, and delays in unmanned systems programs that could impact contract values across regions.
    • Niche Market Limitations: Specialization in defense imaging creates market size constraints and limits growth opportunities compared to broader defense technology companies with diversified portfolios and multiple revenue streams internationally.
    • Defense Technology Competition: The company faces competition from established defense contractors like Lockheed Martin, Raytheon, and specialized imaging companies developing alternative surveillance solutions and technologies across key programs.
    • Small Company Scale: Limited resources compared to large defense contractors may constrain ability to compete for major programs, invest in next‑generation technologies, and maintain required security clearances at scale for alliances.

    Final thoughts on Next Vision Stabilized Systems

    Next Vision`s imaging leadership, defense specialization, and integration with unmanned systems position it strongly in surveillance and reconnaissance for modern military operations. Budget dependence, niche scale, competitive pressure, and program execution risks still require disciplined planning and careful evaluation of defense market dynamics. Like a high‑resolution camera delivering precise intelligence, Next Vision combines technical precision with mission focus to serve allied forces effectively.

  • Aryt Industries (TA:ARYT)

    Aryt Industries Ltd. is an Israel-based defense technology company that designs and manufactures electronic fuses and detonators for artillery, armored platforms, and aerospace applications. Founded in 1979, Aryt has evolved through specialization in precision fuze electronics and safety-critical systems for military customers and allied partners. The company benefits from rising modernization programs and sustained demand for mission reliability across munitions and defense platforms globally today.

    Aryt`s operations focus on proximity, time, and programmable fuzes and supporting electronics that meet stringent certification standards for lethality, safety, and interoperability. The company serves Israel`s defense industry and international partners through subcontracting, integration support, tailored engineering, and testing efforts across programs. With mission-critical products aligned to defense procurement cycles, Aryt seeks durable growth through technology upgrades, export opportunities, and portfolio extensions.

    Aryt Industries financial statements

    Analysts recommendation: N/A

    Financial Health

    • Return on assets (ROA): 27.69%
    • Return on equity (ROE): 90.24%
    • Return on investment (ROI): N/A

    Profitability

    • Gross margin: 61.37%
    • Operating margin: 54.67%
    • Net profit margin: 59.31%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 1.52
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 1518.3%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 430.6%

    💡 Why invest in Aryt Industries?

    Aryt aligns specialized munitions electronics with mission reliability and safety for defense platforms and procurement programs:

    • Defense Fuse Leadership: Aryt specializes in proximity, time, and programmable fuse electronics for artillery and armored platforms, delivering certified performance and reliability that strengthens positioning in defense modernization programs.
    • Proven Military Integration: Established integration with Israeli defense primes and end users enhances validation, lifecycle feedback, and iteration cycles that improve readiness, interoperability, and mission assurance across platform families.
    • Specialized Engineering Expertise: Deep domain knowledge in safety‑critical systems creates barriers to entry, enabling premium pricing for certified solutions and strengthening margins through high‑value electronics for programs and variants.
    • International Market Opportunities: Export channels and subcontracting partnerships provide access to allied markets, increasing demand and enabling growth beyond domestic programs while diversifying revenue sources across contracts.

    🐌 Key considerations before investing in Aryt Industries

    Aryt faces budget dependence, export constraints, product concentration, and certification timelines, creating execution risks:

    • Defense Budget Dependence: Revenue depends on procurement cycles, budget priorities, and program timing, exposing results to policy shifts, election outcomes, and allocation changes that affect volumes and margin cadence across periods.
    • Geopolitical Export Risks: International sales face export controls, end‑use restrictions, and geopolitical tensions that can delay approvals or limit market access, requiring resilient compliance frameworks and diversified relationships.
    • Product Concentration Exposure: Concentration in fuse electronics and limited adjacent scope increases vulnerability to program changes, necessitating portfolio expansion and sustained R&D to broaden demand and reduce single‑line dependence.
    • Technology Certification Timelines: Safety‑critical systems require rigorous qualification and testing cycles that extend development timelines, elevate costs, and create schedule risk for new variants without near‑term production certainty.

    Final thoughts on Aryt Industries

    Aryt Industries' specialization in certified munitions electronics, proven military integration, and export opportunities positions it to benefit from defense modernization and mission readiness priorities. Yet exposure to budget cycles, geopolitical constraints, and product concentration requires prudent planning and portfolio development across markets and platforms. For investors seeking targeted defense electronics exposure, Aryt offers a focused, mission‑critical niche with disciplined growth potential for long‑term portfolios.

  • Rheinmetall (DE:RHM)

    Rheinmetall AG is a leading German technology group dedicated to mobility and security, specializing in defense equipment and automotive components. Founded in 1889 and headquartered in Düsseldorf, Germany, the company has evolved through decades of excellence to become central to European defense manufacturing and technology. Rheinmetall serves NATO and allied forces across Europe and beyond through its extensive portfolio of armored vehicles, weapons systems, and ammunition.

    Rheinmetall is a key player in European defense, benefiting from renewed focus on defense capabilities and military modernization across the continent. Its automotive division complements the defense business by providing advanced components to the global vehicle market and supporting efficiency, safety, and electrification initiatives. The group`s dual expertise supports long‑term programs, mission readiness, and industrial capacity across allied nations, enabling sustained modernization and logistics resilience.

    Rheinmetall financial statements

    Analysts recommendation: 1.8

    Financial Health

    • Return on assets (ROA): 6.75%
    • Return on equity (ROE): 22.42%
    • Return on investment (ROI): 8.82%

    Profitability

    • Gross margin: 52.13%
    • Operating margin: 12.16%
    • Net profit margin: 7.64%

    Growth

    • EPS (past 5 years): 26.49%
    • EPS (current): 18.85
    • EPS estimate (next quarter): 2.23
    • EPS growth (this year): 8.5%
    • EPS growth (next year): 56.54%
    • EPS growth (next 5 years): 14.44%
    • EPS growth (quarter-over-quarter): 33.23%
    • Sales growth (past 5 years): 10.88%
    • Sales growth (quarter-over-quarter): 13.3%

    💡 Why invest in Rheinmetall?

    Rheinmetall stands as a pillar of European defense with industrial heritage and modern military relevance across key programs:

    • European Defense Leader: Rheinmetall is a primary beneficiary of increased German and European defense spending, securing major contracts for ammunition, tanks, and air defense systems amidst rising security concerns across priority platforms.
    • Ammunition Market Dominance: As one of the world`s largest producers of large‑caliber ammunition, the company is positioned to meet urgent and sustained demand from NATO stockpiles and allied forces across multiple theaters of operation.
    • Combat Vehicle Excellence: Renowned for the Leopard 2 main battle tank and Puma infantry fighting vehicle, Rheinmetall`s armored systems set standards for ground combat with proven reliability and mission effectiveness in NATO operations.
    • Strong Order Backlog: Record order intake provides multi‑year revenue visibility, driven by long‑term framework agreements with the German Bundeswehr and international customers across Europe, North America, and allied regions consistently.

    🐌 Key considerations before investing in Rheinmetall

    Despite strategic importance, Rheinmetall faces challenges inherent to defense and its dual‑industry structure across regions:

    • Export Control Regulations: Strict German arms export laws can limit sales opportunities to certain non‑NATO countries, potentially hindering market expansion compared to competitors in less regulated jurisdictions globally materially.
    • Automotive Sector Volatility: The automotive division exposes the company to cyclical downturns in the car industry and the challenges of transitioning to electric mobility, potentially weighing on overall margins and returns meaningfully.
    • Supply Chain Pressures: Scaling production to meet surging demand strains supply chains, requiring effective management of raw materials, vendor capacity, logistics constraints, and skilled labor availability across programs globally.
    • ESG Investment Concerns: Despite changing perceptions, some ESG‑focused funds and investors may still exclude defense stocks, potentially limiting the ownership base and valuation premium relative to other industrial peers internationally.

    Final thoughts on Rheinmetall

    Rheinmetall represents a compelling investment in the re‑arming of Europe, backed by dominance in ammunition and armored vehicles and expanding participation in strategic programs. While export restrictions and automotive exposure present risks, the company's central role in German and NATO defense strategies offers a strong growth trajectory. For investors seeking direct exposure to the European defense supercycle, Rheinmetall stands out as a key industrial asset with durable backlog visibility and modernization demand.

  • Rolls-Royce Holdings (L:RR)

    Rolls-Royce Holdings plc is a British aerospace and defense company that designs, manufactures, and services power systems for global defense applications. Founded in 1906 and headquartered in London, the company is a leading provider of military engines, propulsion systems, and defense technologies for allied customers. The company has shown recovery and growth momentum following strategic restructuring, with expanding defense order books and rising demand for propulsion systems.

    Defense portfolio includes jet engines for the F-35 Lightning II and Eurofighter Typhoon, naval propulsion for submarines and destroyers, and aircraft carrier systems. Rolls-Royce provides land-based power systems for military installations and specialized defense applications across key geographies, supporting resilience and mission readiness. With rising defense spending, the company is positioned to capitalize on modernization programs and demand for next-generation systems across air, sea, and land.

    Rolls-Royce Holdings financial statements

    Analysts recommendation: 2.33

    Financial Health

    • Return on assets (ROA): 5.62%
    • Return on equity (ROE): 5843.65%
    • Return on investment (ROI): -14.18%

    Profitability

    • Gross margin: 25.26%
    • Operating margin: 19.03%
    • Net profit margin: 29.62%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 0.68
    • EPS estimate (next quarter): -0.03
    • EPS growth (this year): 282.6%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): -76.6%
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 7.1%

    💡 Why invest in Rolls-Royce Holdings?

    Rolls-Royce demonstrates compelling strengths in global defense propulsion solutions across diverse military platforms worldwide:

    • Defense Engine Dominance: Rolls-Royce powers critical military aircraft including the F-35, Eurofighter Typhoon, and C-130J, creating decades of predictable aftermarket revenue through maintenance and spare parts across allied fleets.
    • Multi-Domain Defense Portfolio: The company`s defense capabilities span air, sea, and land, including jet engines, naval propulsion systems, and power generation, reducing reliance on a single program and enabling cross-selling opportunities.
    • Strategic Defense Partnerships: Rolls-Royce maintains long-term partnerships with major defense contractors like Lockheed Martin, BAE Systems, and Boeing, ensuring integration into next-generation platforms and early access to opportunities.
    • Advanced Propulsion Technology: The company leads in developing military propulsion including adaptive cycle engines and hybrid-electric systems, creating premium pricing opportunities and sustained technology leadership across defense programs.

    🐌 Key considerations before investing in Rolls-Royce Holdings

    Rolls-Royce faces program concentration, intense competition, and significant technology transition risks across defense markets:

    • Defense Program Concentration: Heavy dependence on major defense programs like the F-35 creates concentration risk, as delays, budget cuts, or cancellations could substantially impact revenue while military priority changes reduce demand.
    • Competitive Defense Market: Rolls-Royce faces intense competition from General Electric, Pratt & Whitney, and Safran, plus emerging technology companies developing alternative propulsion solutions that pressure margins across key programs.
    • Cyclical Recovery Execution: The company must continue executing its transformation strategy while managing challenges of returning to sustainable profitability following financial difficulties and restructuring efforts with disciplined execution.
    • Technology Transition Risk: Rapid technological change toward electric propulsion and autonomous systems could disrupt traditional jet engine markets, requiring substantial investment with uncertain adoption timelines and added development risks.

    Final thoughts on Rolls-Royce Holdings

    Rolls-Royce`s leadership in military propulsion, multi-domain portfolio, and strategic partnerships offers opportunities in the expanding global defense market for investors. However, program concentration, competitive pressure, transformation execution, and technology transitions require careful evaluation of aerospace and defense market dynamics today. Like a pilot navigating turbulence, Rolls-Royce leverages engineering excellence and deep relationships to power through cycles while positioning for long-term success.

  • Norbit (OL:NORBT)

    Norbit ASA is a Norwegian technology company specializing in advanced sensor systems, underwater surveillance technologies, and defense solutions for maritime and military applications worldwide. Founded in 1995, the company evolved from a small electronics firm into a leading provider of defense and maritime technologies for NATO allies. The company has demonstrated strong growth in defense contracts, particularly in underwater surveillance systems and maritime security solutions for naval forces.

    The defense portfolio includes advanced sonar for submarine detection, underwater surveillance for naval operations, maritime security solutions, and specialized military sensor systems. Norbit`s products are integral to critical defense infrastructure including naval bases, underwater monitoring networks, and maritime border security systems used by allied forces. Rising focus on maritime security and underwater domain awareness positions Norbit to benefit from naval modernization and demand for advanced underwater surveillance capabilities.

    Norbit financial statements

    Analysts recommendation: 2.1

    Financial Health

    • Return on assets (ROA): 14.4%
    • Return on equity (ROE): 34.13%
    • Return on investment (ROI): 11.2%

    Profitability

    • Gross margin: 55.64%
    • Operating margin: 22.55%
    • Net profit margin: 16.16%

    Growth

    • EPS (past 5 years): 24.8%
    • EPS (current): 6.32
    • EPS estimate (next quarter): 14.2
    • EPS growth (this year): 23.4%
    • EPS growth (next year): 22.4%
    • EPS growth (next 5 years): 19.3%
    • EPS growth (quarter-over-quarter): 31.7%
    • Sales growth (past 5 years): 18.9%
    • Sales growth (quarter-over-quarter): 42.3%

    💡 Why invest in Norbit?

    Norbit shows compelling qualities that make it stand out in its market sector for potential long-term investors comprehensively:

    • Underwater Surveillance Leadership: Norbit leads in advanced sonar and underwater detection technologies for naval forces, creating specialized capabilities that are difficult to replicate and command premium pricing in defense markets.
    • Maritime Security Growth: The company benefits from increasing global focus on maritime security, underwater domain awareness, and naval modernization programs driven by evolving maritime threats and geopolitical tensions, supporting demand.
    • NATO Defense Partnerships: Norbit serves NATO allies and international naval forces with critical underwater surveillance systems, providing stable revenue and opportunities for defense partnerships that support program continuity and collaboration.
    • Maritime Technology Moat: The company`s expertise in underwater acoustics, sensor fusion, and maritime surveillance creates significant barriers to entry and competitive advantages in niche defense applications, reinforcing adoption.

    🐌 Key considerations before investing in Norbit

    Before investing in Norbit, consider headwinds that could affect performance, execution, and returns in defense markets carefully:

    • Defense Spending Vulnerability: Heavy reliance on naval defense spending makes the company vulnerable to military budget cuts, changing procurement priorities, and delays in maritime modernization programs worldwide, and timing risks.
    • Market Size Limitations: Specialization in underwater surveillance creates market size constraints and limits growth opportunities compared to broader defense technology companies and diversified peers, scaled platforms in global programs.
    • Technology Development Risks: Rapid advancement in underwater detection technologies and autonomous systems could disrupt traditional sonar markets, requiring continuous R&D investment with uncertain returns and market positioning today.
    • Scale Resource Constraints: Limited resources compared to large defense contractors may constrain ability to compete for major programs and invest in next-generation technologies at required scale levels for global market expansion.

    Final thoughts on Norbit

    Norbit`s leadership in underwater surveillance, positioning in maritime security, and specialized defense capabilities offer targeted exposure to niche naval technology growth. Dependence on defense budgets, market size constraints, development risk, and scale limitations require measured expectations and careful evaluation of program execution. Match investment decisions to risk appetite and horizon, and monitor contracts, modernization programs, and funding to navigate evolving maritime defense dynamics.

  • Saab (ST:SAAB-B)

    Saab AB is a Swedish defense and aerospace company specializing in fighter aircraft, naval systems, and electronic warfare technologies for global customers. Founded in 1937 and headquartered in Stockholm, Sweden, the company evolved from aircraft manufacturing into a defense technology provider in aviation, submarines, and radar. The company benefits from increased European defense spending and NATO modernization programs amid heightened geopolitical tensions across Northern Europe and the Baltic region.

    Core business includes Gripen fighter aircraft, advanced radar and sensor systems, submarine technologies, missile systems, and integrated command and control solutions. Products support air defense networks, electronic warfare, maritime security, and battlefield management systems used by NATO forces and allied nations. With rising defense spending, Saab is positioned to capitalize on modernization and demand for advanced systems amid evolving security threats across NATO`s eastern flanks.

    Saab financial statements

    Analysts recommendation: N/A

    Financial Health

    • Return on assets (ROA): 4.21%
    • Return on equity (ROE): 15.99%
    • Return on investment (ROI): N/A

    Profitability

    • Gross margin: 21.69%
    • Operating margin: 10.55%
    • Net profit margin: 7.98%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 11.67
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 77.7%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 32.8%

    💡 Why invest in Saab?

    Saab shows strengths in Nordic defense innovation and NATO technology leadership globally, backed by programs and partnerships:

    • Nordic Defense Leadership: Saab holds dominant market positions in fighter aircraft, radar systems, and electronic warfare across Northern European defense markets, creating substantial competitive advantages and high barriers to entry.
    • Defense Technology Innovation: The company invests approximately 25% of annual revenue into defense R&D, developing next-generation military technologies in electronic warfare, autonomous systems, and stealth capabilities that enhance effectiveness.
    • NATO Spending Beneficiary: Saab benefits from NATO`s commitment to increase defense spending to 2% of GDP and widespread military modernization programs across European allied nations driven by geopolitical tensions across allied markets.
    • Defense Export Strategy: The company has successfully expanded its global defense footprint beyond Europe with strategic military partnerships in Asia, Middle East, and the Americas, creating diversified revenue streams with regional partners.

    🐌 Key considerations before investing in Saab

    Saab faces European budget volatility, intense competitive pressures, and export restrictions across key markets and programs:

    • European Budget Volatility: Heavy reliance on European defense spending makes the company vulnerable to budget cuts, political changes, and shifts in military priorities that could impact contract values and growth prospects over planning cycles.
    • Defense Sector Competition: Saab faces intense competition from larger defense contractors like Lockheed Martin, BAE Systems, and Thales, which have superior resources, global reach, and established military relationships across major programs.
    • Defense Export Restrictions: As a Swedish defense contractor, Saab faces strict export controls, arms transfer regulations, and potential political restrictions that can limit international sales opportunities under strict controls and treaties.
    • Complex Program Execution: Major defense development programs like fighter aircraft and submarine systems involve significant technical challenges, potential delays, and cost overruns that could impact profitability, requiring management discipline.

    Final thoughts on Saab

    Saab`s leadership in Nordic defense systems and innovation, with strong positioning in European security frameworks, offers opportunities in defense technology growth. However, budget volatility, competition, export restrictions, and complex program execution risks require careful evaluation of specialized defense market dynamics today. Like a radar detecting distant threats, Saab combines technology and strategy to navigate geopolitics while delivering advanced solutions for allied nations.

  • Kongsberg (OL:KOG)

    Kongsberg Gruppen is a Norwegian defense technology company headquartered in Kongsberg, Norway, specializing in missile systems, remote weapon stations, and military electronics. Founded in 1814, the company evolved from traditional defense manufacturing into a global provider of advanced weapon systems and integrated technologies for modern military needs. It holds leading positions in European defense markets, supplying NATO allies with precision systems and mission-critical electronic solutions across regions.

    Core businesses include Naval Strike Missile (NSM) and Joint Strike Missile (JSM), remote weapon stations, air defense systems, and specialized defense electronics for multiple platforms. These products support anti-ship warfare, air defense networks, and vehicle protection, enabling interoperable capabilities across NATO and allied forces today. With rising defense spending, Kongsberg is positioned to benefit from European modernization and demand for sophisticated weapon systems across allied markets.

    Kongsberg financial statements

    Analysts recommendation: N/A

    Financial Health

    • Return on assets (ROA): 3.88%
    • Return on equity (ROE): 19.5%
    • Return on investment (ROI): N/A

    Profitability

    • Gross margin: 18.61%
    • Operating margin: 17.16%
    • Net profit margin: 25.2%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 4.74
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 62%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): -31%

    💡 Why invest in Kongsberg?

    Kongsberg demonstrates strengths in Norwegian defense and strong NATO integration, supporting modernization across allied markets:

    • NATO Defense Integration: Kongsberg`s missile systems and remote weapon stations are deeply integrated into NATO defense infrastructure, creating long-term revenue through procurement programs, strategic partnerships, and lifecycle support.
    • Norwegian Defense Leadership: The company holds dominant market positions in anti-ship missiles, vehicle protection systems, and defense electronics across European markets, providing substantial competitive advantages across allied programs.
    • Defense Spending Tailwinds: Kongsberg benefits from NATO`s commitment to increase defense spending to 2% of GDP and widespread military modernization programs across European allied nations driven by tensions and renewed priorities.
    • Cutting-Edge Defense Tech: The company`s expertise in precision strike capabilities, autonomous systems, and integrated defense solutions creates significant technological advantages and premium pricing power for premium defense contracts.

    🐌 Key considerations before investing in Kongsberg

    Kongsberg faces budget volatility, export controls, and intense competition, requiring disciplined execution and planning:

    • Defense Budget Volatility: Heavy reliance on European defense spending makes the company vulnerable to budget cuts, political changes, and shifts in military priorities that could impact contract values and growth and multi-year frameworks.
    • Export Control Restrictions: As a defense contractor, Kongsberg faces strict export controls, arms transfer regulations, and potential sanctions that can limit international sales opportunities and create compliance challenges and oversight.
    • Project Management Challenges: Complex development programs and defense contracts face potential delays, cost overruns, and technical challenges that could impact profitability, ministry relationships, and regulatory compliance demands.
    • Global Defense Competition: Kongsberg faces intense competition from established defense contractors like Raytheon, MBDA, and Lockheed Martin, which have superior resources, global reach, and established relationships across contested markets.

    Final thoughts on Kongsberg

    Kongsberg`s leadership in European defense systems and NATO integration offers attractive exposure to modernization spending across allied markets and programs. However, budget volatility, export controls, complex programs, and competition require careful evaluation of defense market dynamics by disciplined investors today. Like a precise commander, Kongsberg combines technology and partnerships to deliver mission-critical systems for allied forces while navigating complex geopolitical environments.

  • Firan Technology Group (TO:FTG)

    Firan Technology Group Corporation is a Canadian aerospace and defense technology company specializing in advanced electronic manufacturing services and precision machined components. Founded in 1967 in Toronto, the company evolved from a small electronics maker into a diversified provider serving aerospace, defense, and industrial markets. The company grew through acquisitions and organic expansion, establishing North American facilities to serve blue-chip customers including Boeing, Airbus, and Lockheed Martin.

    Firan operates two segments - electronic manufacturing services and precision machined components - delivering mission‑critical solutions for commercial aviation, military aircraft, and space applications. Core activities include PCB assembly, complex system integration, precision CNC machining, and processes that meet stringent aerospace standards including AS9100 certification. With growing demand for advanced avionics, defense electronics, and next‑generation aircraft systems, Firan is positioned to capitalize on aerospace recovery and modernization.

    Firan Technology Group financial statements

    Analysts recommendation: 2

    Financial Health

    • Return on assets (ROA): 8.98%
    • Return on equity (ROE): 17.62%
    • Return on investment (ROI): 6.1%

    Profitability

    • Gross margin: 36.01%
    • Operating margin: 11.38%
    • Net profit margin: 7.51%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 0.56
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 0%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 10.8%

    💡 Why invest in Firan Technology Group?

    Firan Technology Group leverages aerospace recovery, major customers, and AS9100 certification to sustain growth and pricing:

    • Aerospace Recovery Tailwinds: The global aerospace industry`s recovery from pandemic lows drives increasing demand for Firan`s electronic manufacturing services and precision components, creating significant revenue growth opportunities.
    • Defense Spending Stability: Growing defense budgets across North America and allied nations provide stable, long-term revenue streams for Firan`s military-grade electronic systems and specialized manufacturing capabilities, aiding backlog visibility.
    • Diversified Customer Base: Strong relationships with blue-chip aerospace OEMs including Boeing, Airbus, and Lockheed Martin reduce customer concentration risk while ensuring access to high-value, long-duration programs and repeat orders.
    • Advanced Manufacturing Expertise: AS9100-certified facilities and specialized capabilities in complex electronic assembly and precision machining create significant barriers to entry and command premium pricing in niche markets and core platforms.

    🐌 Key considerations before investing in Firan Technology Group

    Firan Technology Group faces aerospace cyclicality, supply risks, competition, and capital intensity that pressure margins:

    • Aerospace Cyclical Exposure: The aerospace industry`s inherent cyclicality and sensitivity to economic downturns, geopolitical tensions, and supply chain disruptions can create volatile demand patterns for Firan`s products and services.
    • Supply Chain Dependencies: Reliance on specialized components and materials from global suppliers exposes Firan to potential shortages, price volatility, and delivery delays that could impact production schedules and margins during disruptions.
    • Competitive Pricing Pressure: Intense competition from larger EMS providers and offshore manufacturers can pressure margins, particularly in commodity electronic assembly services where differentiation is limited and contract pricing may soften.
    • Capital Intensive Operations: Maintaining state-of-the-art manufacturing equipment and meeting stringent aerospace quality standards requires continuous capital investment that can strain cash flow during slower periods and limit flexibility.

    Final thoughts on Firan Technology Group

    Firan Technology Group's specialized manufacturing, diversified customers, AS9100 certification, and exposure to recovering end markets create opportunities for precision manufacturing investors. Investors must consider aerospace cyclicality, supply chain vulnerabilities, and competitive pressures that characterize electronic manufacturing services and impact margins materially. Like a skilled aerospace engineer balancing performance with reliability, Firan offers rewards to investors who understand opportunities and challenges in demanding aerospace and defense sectors.

  • Leonardo DRS (MI:LDO)

    Leonardo DRS is a leading American defense contractor specializing in advanced sensor systems and electronic warfare capabilities for military applications worldwide. Founded in 1969 in Arlington, Virginia, the company operates as a subsidiary of Leonardo S.p.A., combining Italian and American defense expertise. This strategic positioning enables Leonardo DRS to leverage global defense technology leadership while maintaining focused access to critical U.S. defense programs.

    The company delivers mission-critical defense technologies including infrared imaging systems, naval combat systems, and ground vehicle electronics for military platforms. Leonardo DRS specializes in sensor integration, electronic warfare solutions, and military communication technologies that enhance battlefield awareness and operational effectiveness. With rising global defense expenditure and increasing demand for sophisticated military technologies, the company is positioned to capitalize on modernization programs.

    Leonardo DRS financial statements

    Analysts recommendation: 1.78

    Financial Health

    • Return on assets (ROA): 4.43%
    • Return on equity (ROE): 11.76%
    • Return on investment (ROI): 7.88%

    Profitability

    • Gross margin: 37.92%
    • Operating margin: 7.12%
    • Net profit margin: 5.54%

    Growth

    • EPS (past 5 years): 9%
    • EPS (current): 2
    • EPS estimate (next quarter): 0.22
    • EPS growth (this year): 56.7%
    • EPS growth (next year): 16.05%
    • EPS growth (next 5 years): 13.87%
    • EPS growth (quarter-over-quarter): 70.64%
    • Sales growth (past 5 years): 3.78%
    • Sales growth (quarter-over-quarter): 10.6%

    💡 Why invest in Leonardo DRS?

    Leonardo DRS demonstrates compelling strengths in advanced defense sensor and electronic warfare technology for global operations:

    • Defense Technology Leadership: Leonardo DRS holds dominant market positions in sensor systems, electronic warfare, and naval combat technologies, creating substantial competitive advantages and high barriers to entry for competitors.
    • Operational Execution Risks: Leonardo DRS maintains consistent operational discipline in complex defense program execution, delivering advanced sensor and electronic warfare systems on schedule and within budget for defense customers globally.
    • Advanced Military Innovation: Leonardo DRS invests heavily in cutting-edge technologies including hypersonic systems, electro-optical sensors, and next-generation electronic warfare capabilities that maintain technological leadership.
    • Defense Spending Beneficiary: The company benefits from increased U.S. defense budgets, military modernization programs, and growing demand for advanced sensor technologies driven by near-peer competition and evolving global threats.

    🐌 Key considerations before investing in Leonardo DRS

    Leonardo DRS faces significant budget dependency on U.S. defense spending, intense contractor competition, and geopolitical risks:

    • U.S. Budget Dependency: Heavy reliance on U.S. defense spending makes the company vulnerable to budget cuts, political changes, and shifts in military priorities that could impact contract values, revenue stability, and long-term growth.
    • Defense Contractor Competition: Leonardo DRS faces intense competition from established defense contractors like Raytheon, Lockheed Martin, and Northrop Grumman, which have superior resources, broader defense portfolios, and global scale.
    • Technology Disruption Risk: Rapid advancement in defense technologies and emerging competitors could challenge the company`s market position in sensor systems and electronic warfare capabilities across multiple defense domains today.
    • Geopolitical Supply Risks: As a subsidiary of Italian Leonardo S.p.A., the company faces potential supply chain disruptions, export restrictions, and geopolitical tensions that could significantly impact operations, growth, and partner relationships.

    Final thoughts on Leonardo DRS

    Leonardo DRS`s leadership in defense sensors, electronic warfare, and military innovation creates compelling opportunities for investors seeking U.S. defense technology exposure. However, budget volatility, competitive pressures, technology disruption risks, and geopolitical supply chain challenges require careful evaluation of defense market dynamics. Leonardo DRS leverages its technological excellence and strategic positioning to deliver mission-critical capabilities for U.S. military forces and allied customers.

  • Howmet Aerospace (NYSE:HWM)

    Howmet Aerospace Inc. designs and manufactures advanced engineered metal components for aerospace, defense, and transportation applications worldwide with global customers. Founded in 1888 as part of Alcoa, the company combines materials science, process innovation, and manufacturing excellence to deliver lightweight, high-performance solutions. Howmet Aerospace supports mission-critical programs across commercial aviation and defense platforms, advancing efficiency, durability, and reliability through specialized alloys and precision processes.

    The company focuses on jet engine components, structural parts, and fastening systems that improve fuel efficiency, performance, and lifecycle economics. Capabilities in titanium, aluminum, and superalloys enable advanced designs for OEM partners, supporting program schedules, durability requirements, and demanding operating environments. Strategic priorities include capacity investments, supply chain resilience, and long-term agreements that align production plans with customer demand and platform growth.

    Howmet Aerospace financial statements

    Analysts recommendation: 1.48

    Financial Health

    • Return on assets (ROA): 12.13%
    • Return on equity (ROE): 30.44%
    • Return on investment (ROI): 17.13%

    Profitability

    • Gross margin: 34.17%
    • Operating margin: 26.34%
    • Net profit margin: 18.27%

    Growth

    • EPS (past 5 years): 22.24%
    • EPS (current): 3.71
    • EPS estimate (next quarter): 0.96
    • EPS growth (this year): 20.3%
    • EPS growth (next year): 20.38%
    • EPS growth (next 5 years): 24.84%
    • EPS growth (quarter-over-quarter): 17.45%
    • Sales growth (past 5 years): 0.92%
    • Sales growth (quarter-over-quarter): 14.6%

    💡 Why invest in Howmet Aerospace?

    Howmet Aerospace shows compelling qualities that make it stand out in its market sector for potential long-term investors:

    • Aerospace Market Leadership: Howmet holds dominant market positions in jet engine components, structural parts, and advanced metal solutions across commercial and military aerospace markets, creating substantial competitive advantages.
    • Advanced Materials Innovation: The company develops cutting-edge titanium and superalloy components for military aircraft and defense systems, benefiting from increased defense spending and military modernization programs worldwide.
    • Commercial Aviation Recovery: Howmet benefits from the strong recovery in commercial aviation demand, increased aircraft production rates, and airlines` focus on fuel-efficient aircraft that require advanced lightweight components while maintaining.
    • Long-Term Customer Contracts: The company maintains strategic partnerships with major aerospace manufacturers like Boeing, Airbus, and defense contractors, creating predictable revenue streams and high customer switching costs while maintaining dis.

    🐌 Key considerations before investing in Howmet Aerospace

    Howmet Aerospace faces several challenges that investors must evaluate carefully before making investment decisions effectively:

    • Cyclical Aerospace Demand: Heavy reliance on commercial aviation makes the company vulnerable to economic downturns, travel disruptions, and aircraft production delays that could impact revenue stability and growth prospects while maintaining disci.
    • Major Customer Dependence: Dependence on major aerospace manufacturers like Boeing and Airbus creates vulnerability to production schedule changes, program cancellations, and customer-specific challenges that could affect revenue across programs.
    • Material Price Volatility: Exposure to fluctuating prices of titanium, aluminum, and specialty metals can impact profit margins and operational costs, requiring effective hedging strategies and supply chain management while maintaining disciplined .
    • Competitive Aerospace Market: Howmet faces intense competition from established aerospace suppliers and emerging manufacturers, which could pressure pricing, market share, and profitability in key component categories while maintaining disciplined .

    Final thoughts on Howmet Aerospace

    Howmet`s leadership in aerospace metal solutions, defense technology innovation, commercial aviation recovery benefits, and strategic customer partnerships create compelling opportunities for investors seeking exposure to. However, the company`s exposure to cyclical aerospace demand, customer concentration risks, raw material volatility, and competitive pressures require careful evaluation of the complex dynamics in. Like a master metallurgist who forges high-performance alloys under extreme conditions, Howmet combines technological excellence with strategic positioning to navigate market challenges while delivering mission-critical.

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If you prefer to filter defense stocks by market cap, explore my lists of the best mega cap defense stocks.

If you are interested specifically in European defense stocks, check out my best European defense stocks.