We recently published a list of 13 Best Defense Stocks to Buy According to Billionaires. In this article, we are going to take a look at where L3Harris Technologies, Inc. (NYSE:LHX) stands against other best defense stocks to buy according to billionaires.
Defense stocks wobbled over the past week after a contentious meeting at the Oval Office between President Trump and the visiting Ukrainian leader, Volodymyr Zelensky as investors hoped for the US-Ukraine minerals deal to be signed.
The sector has struggled since Trump’s return to the White House, amid mixed statements on military expenditure throughout his campaign and the early days of his second stint. Shares fell sharply on February 13 after the President hinted at cutting defense spending in the future. The creation of DOGE is also reshaping investors’ views of the industry.
READ ALSO: 10 Best Large Cap Defense Stocks to Buy Now and Why These 15 Defense Stocks Are Skyrocketing So Far In 2025.
In contrast, European defense stocks have rallied this year as governments faced pressures to increase military expenditure. Several stocks registered double-digit growth during the week of March 3, with some even reaching record highs. Investor sentiment picked up after the European Summit in London, where leaders from the EU and NATO met to express their support for Ukraine, following the recent Zelensky-Trump spat.
Washington has repeatedly called for European countries to spend more on defense, while stressing that the US could no longer foot the bill. EU leaders met in Brussels this Thursday to discuss the ‘ReArm Europe Plan’, which will allow the bloc to mobilize funds up to $860 million through bonds and relaxed rules on borrowing and spending.
European countries are also ramping up defense on an individual-level. A conservative victory in Germany, signaling the shift to the right in Berlin, is also adding to the momentum. According to a Reuters report, parties in talks to form the nation’s next government are already considering setting up a defense fund. Friedrich Merz, Germany’s next chancellor-in-waiting, has also vowed to relax the country’s strict borrowing rules.
Peter Schaffrik, Global Macro Strategist, at RBC Capital Markets stated the following on the ongoing situation:
It is an inflection point and Europe realises it needs to do the heavy lifting. The German elections have opened the door for more spending. The whole Zelensky-Trump meltdown has fast forwarded everything.
Methodology
For this article, we scanned Insider Monkey’s Q4 2024 proprietary database of billionaires’ stock holdings and identified defense stocks from the list. From there, we picked the top 13 stocks with the highest number of billionaires having a stake in them. Where two or more stocks were tied on billionaire sentiment, we used the dollar value of billionaire holdings as a tiebreaker between them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A military jetfighter against a deep blue sky with the sun behind it.
L3Harris Technologies, Inc. (NYSE:LHX)
Number of Billionaires: 11
Billionaire Holdings: $319,024,019
L3Harris Technologies, Inc. (NYSE:LHX) is known for its wireless and night vision equipment, command and control systems, avionics, and terrestrial and spaceborne antennas. It was formed in 2019 after Harris Corporation and L3 Technologies merged.
On February 28, the company’s board of directors approved an increase in quarterly cash dividend from $1.16 to $1.20 per share. This is the 24th successive annual dividend raise, reflecting L3Harris Technologies, Inc. (NYSE:LHX)’s commitment to strong shareholder returns.
Recent contract awards have also enhanced the stock’s appeal among investors. On January 21, L3Harris Technologies, Inc. (NYSE:LHX) clinched a $263 million deal from the US Army for additional production of Enhanced Night Vision Goggle–Binocular (ENVG-B) systems, which will boost the capabilities of American troops to identify and engage enemy targets in low-light conditions.
Later in the month, the Army awarded L3Harris Technologies, Inc. (NYSE:LHX) another $300 million contract for the production of military communication radios, as part of continued proliferation of resilient communication solutions for American soldiers serving the nation in complex operational environments.
L3Harris Technologies, Inc. (NYSE:LHX)’s financial performance remains robust. During its Q4 2024 earnings call, the company reported non-GAAP diluted earnings per share of $3.47, beating expectations. This was driven by robust demand across the business coupled with operational efficiencies. Revenue for fiscal 2024 stood at $21.3 billion, growing 10% from last year.
Wall Street analysts have a consensus Buy rating for L3Harris Technologies, Inc. (NYSE:LHX), with an average share price upside potential of 25%. According to Insider Monkey’s database for Q4 2024, 11 billionaires have investments in the company, making it one of the best defense stocks to buy according to billionaires.
Overall, LHX ranks 11th on our list of best defense stocks to buy according to billionaires. While we acknowledge the potential of LHX as an investment, our conviction lies in the belief that 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 more promising than LHX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
