We recently published a list of Why These Defense Stocks Are Declining This Week. In this article, we are going to take a look at where Byrna Technologies Inc. (NASDAQ:BYRN) stands against other defense stocks that are declining this week.

Defense stocks were volatile last month. Shares fell sharply on February 13 after the American president suggested his country could rapidly cut military spending in the future. Trump made these comments in the context of a potential future conference with China and Russia to discuss cutting defense expenditure to spend the money in other areas.

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Trump has also vowed to end the tumultuous wars in the Middle East and Europe. The U.S. is actively engaging key players in the Middle East for an extension of the truce in Gaza. On February 17, American and Russian officials met in Saudi Arabia to discuss ending the Ukraine war.

Some analysts view his anti-war stance as detrimental to defense stocks. The creation of the Department of Government Efficiency (DOGE), which aims to reduce wasteful spending, cut unnecessary regulations, and restructure federal agencies, is also reshaping investors’ views of the sector.

Byron Callan, managing partner at Capital Alpha Partners, believes there is a high level of uncertainty in the U.S. defense sector related to current and future programs and the likelihood of severe cuts to government workforces.

According to a Financial Times report, shares of the six largest American defense companies have fallen 4% since Trump’s return to the White House. In contrast, Europe’s top defense stocks have risen by nearly 40% over the same period. While the performance of the U.S. defense sector was lagging behind Europe and Asia well before the presidential elections, the gap has widened after Trump’s victory.

Globally, defense stocks have rallied over the past two weeks as European governments faced pressures to increase military expenditure. The momentum has further picked up after a conservative victory in Germany, signaling the shift to the right in Berlin. According to a Bloomberg report, Friedrich Merz, the country’s chancellor-in-waiting, has already opened talks between the Christian Democrats and Social Democrats over a $210 billion emergency defense fund.

While some US defense stocks have benefited from the wave, there are several that have missed out and continue to slide.

Please note that the stocks listed are based on one week’s performance. Our analysis does not reflect the prospects of the company. Their share price could go high or low in the future, depending on the external market conditions, industry-specific challenges, and the company’s capabilities. Additional research and caution are advised before making investment decisions.

Our Methodology

For this article, we went through screeners to see how stocks in the aerospace and defense industry performed over the past week (February 24-28). From there, we picked the top 10 stocks with the highest percentage decline in share price during this period. All data is as of the close of business on Friday, February 28, 2025.

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).

Byrna Technologies Inc. (NASDAQ:BYRN)

Weekly Decline: -9.75%

Byrna Technologies Inc. (NASDAQ:BYRN) manufactures less-lethal equipment and munitions for personal security, private security firms, military, and law enforcement agencies.

The stock has had impressive returns of 129% in the last 6 months, as it benefits from high brand visibility through increased media exposure. This is helping in boosting consumer and law enforcement demand for its products. During the Q4 2024 earnings call on February 5, Byrna Technologies Inc. (NASDAQ:BYRN) reported a 101% increase in net revenue for the fiscal year. Net income also improved to $12.8 million from a net loss of $8.2 million in fiscal 2023.

Over the past week, Byrna Technologies Inc. (NASDAQ:BYRN)’s share price has declined by 9.75%. While there is no conclusive reason for the dip, it may have been sparked by overvaluation concerns among investors, given its high P/E ratio. Last week, BYRN’s top executives were also reported to have sold shares of the company. However, those transactions were part of a 10b5-1 pre-established trading plan.

Overall, BYRN ranks 10th on our list of defense stocks that are declining this week. While we acknowledge the potential of defense companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BYRN 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.