We recently published a list of 10 Defense and Aerospace Stocks To Benefit From Trump’s Peace Through Strength Policy. In this article, we are going to take a look at where General Dynamics Corporation (NYSE:GD) stands against other defense and aerospace stocks to benefit from Trump’s peace through strength policy.
Donald Trump is a vocal critic of international conflicts, especially those in which the US gets involved militarily or financially. At his inauguration, he continued the old Republican policy of Peace Through Strength, implying that the US and its allies should increase defense spending not to fight more wars but to ensure fewer wars happen.
In other words, this means defense contractors continue to make money even if global conflicts die down under Donald Trump. EU leaders have just held an informal meeting to discuss transatlantic relations and defense spending. President of the European Commission, Ursula von der Leyen, is considering extraordinary measures to boost defense budgets.
Under these circumstances, it is vital to understand that most defense and aerospace stocks should continue to benefit even during peaceful times. We, therefore, decided to create a list of stocks that are likely to survive any change in policy during the unpredictable Donald Trump’s term.
To come up with our list of 10 Defense and Aerospace stocks that will benefit from Trump’s Peace Through Strength policy, we only considered stocks that have a market cap of at least $5 billion, an ROE of over 15%, and a forward PE under 40 against an industry average PE of 63.
An aircraft maintenance team in a hanger working on a modern business jet.
General Dynamics Corporation (NYSE:GD)
General Dynamics Corporation is a defense and aerospace company that operates through technologies, marine systems, aerospace, and combat systems. It has had a poor start to the year, falling right after the earnings report which we view as a buying opportunity.
GD’s growth story for 2025 is compelling. Management estimates a growth rate of 5.5% backed by margin expansion and as a result, earnings growth. The company already has a strong balance sheet and is trading just above its 52-week lows. Consequently, the forward PE has dropped to below 18, presenting an opportunity to take a position in the stock.
Some of the recent pessimism surrounding the stock stems from its inability to deliver the aerospace deliveries it guided. The main reason for this could have been the issue with the G700 certification, which resulted in additional testing, complexity, and non-standard workflow where the company lost valuable resources. The hiccup is in the past though as deliveries are back on schedule.
Overall, GD ranks 7th on our list of defense and aerospace stocks to benefit from Trump’s peace through strength policy. While we acknowledge the potential of GD as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as GD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
