In this article, we look at the defense stocks that are gaining this week.
European markets closed higher on Tuesday after Germany’s parliament voted in favor of a historic fiscal package, which includes reforms to long-standing debt policies to allow for higher defense spending. Investors across the world are also keeping a close eye on the situation in Ukraine, after Trump and Putin agreed to an immediate ceasefire for energy and infrastructure in the war that has been on since early 2022.
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Trump’s pivot on Ukraine has fueled robust gains in defense stocks in Europe, where several armament contractors have seen double-digit growth this year, with some even reaching record highs, as European capitals faced pressures to raise defense spending. Korean defense companies have also benefited from the splurge, whereas American defense stocks have largely failed to capitalize on the global rally.
In contrast, America’s defense sector has struggled since Trump’s return to the White House due to mixed statements on future defense spending. The creation of DOGE has also reshaped investors’ views of the industry.
On March 3, the Pentagon, working with DOGE, found some $80 million in what it deemed wasteful funding, which included funds devoted to diversity, equity and inclusion programs, and climate change research. Press Secretary Sean Parnell made the following remarks in a statement posted on X while stating these actions were ‘just the start’:
“This stuff is not a core function of our military. This is a distraction. We believe that these initial findings will probably save $80 million in wasteful spending.”
Despite the downturn, Citi analyst, Jason Gursky, believes this is the right time to invest in American defense stocks. Here is what he wrote in a note to clients on March 5:
“We recognize the world order is evolving under the current President, perhaps to a multi-polar one in which three countries control spheres of influence over the Americas, Europe and Asia. However, we don’t view that world to be any less dangerous or one that decreases the need to acquire the tools of deterrence.”
Gursky further argued that as long as the global threat environment remains and the United States maintains its leadership role, regardless of whether it is as a sole superpower or as a power in a multi-polar world order, defense spending is expected to remain robust, which would benefit stocks in the sector.
In a recent positive development, shares of a major naval defense contractor have surged over the past two weeks after President Trump announced to resurrect America’s military and commercial shipbuilding industry, which he sees as vital to national security, given the strategic competition with China.
With that said, let’s now head over to the list of defense stocks that are gaining this week. 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.
A military jetfighter against a deep blue sky with the sun behind it.
Methodology
For this article, we went through screeners to see how stocks in the aerospace and defense industry performed over the past week (March 10-17). From there, we picked the top 10 stocks with the highest percentage gains in share price during this period. All data is as of the close of business on Monday, March 17, 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).
10. The Boeing Company (NYSE:BA)
Weekly Gains: 9.25%
The Boeing Company (NYSE:BA) is a leading aerospace company that manufactures commercial airplanes, space systems, and defense equipment for customers in over 150 countries. It is among the defense stocks that are gaining this week.
While the company’s challenges have carried well into 2025 and were further aggravated by the recent tariffs, the stock received a boost last week after Citi reiterated its Buy rating for The Boeing Company (NYSE:BA) with a share price target of $210. The analyst believes the market is currently undervaluing the company’s long-term growth potential.
It is worth mentioning that the company has an order backlog of $521 billion, and analysts maintain a consensus Buy rating for the stock in anticipation of a recovery once the headwinds are over. The Boeing Company (NYSE:BA)’s shares have gained 9.25% over the past week.
9. Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS)
Weekly Gains: 9.29%
Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative and affordable products and platforms for national security needs. The company is involved in various technological areas, such as unmanned systems, C5ISR, satellite communications, warfighter training, and combat systems.
It is among the defense stocks that are gaining this week, with returns of 9.29% during the period, amid recent high-value contract awards. On March 11, Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) secured a potential $50 million deal from the Naval Surface Warfare Center to design and manufacture short medium-range suborbital vehicles.
On March 17, Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) received another contract for the BQM-177A Subsonic Aerial Target System from the Naval Air Systems Command, with a potential value of up to $19.1 million.
8. StandardAero, Inc. (NYSE:SARO)
Weekly Gains: 9.85%
StandardAero, Inc. (NYSE:SARO) provides aerospace engine aftermarket services for the commercial, military, and business aviation end markets. It is among the defense stocks that are gaining this week.
On March 10, the company announced strong financial results for fiscal 2024. It reported a full-year revenue of $5,237.2 million, up 14.8% year-over-year. StandardAero, Inc. (NYSE:SARO)’s net income for the year stood at $11 million, improving substantially from a net loss of $35.1 million in 2023. The company’s adjusted EBITDA increased 23.1% from the prior year to $690.5 million.
StandardAero, Inc. (NYSE:SARO) also shared its guidance for fiscal 2025. It expects to deliver double-digit growth on both the top line and the bottom line during the year. Since the announcement, the stock had surged by 9.85% as of the close of the day on March 17.
7. Rocket Lab USA, Inc. (NASDAQ:RKLB)
Weekly Gains: 11.57%
Rocket Lab USA, Inc. (NASDAQ:RKLB) is an end-to-end space company delivering reliable launch services, spacecraft components, spacecraft design services, and related software to support the space economy. It is also working on several defense contracts.
On March 11, the company made a major move to expand its role in the space industry by announcing its intention to acquire Mynaric, a German firm that specializes in laser optical communications terminals. The transaction is expected to further strengthen Rocket Lab USA, Inc. (NASDAQ:RKLB)’s position in national security contracts.
Last week, Rocket Lab USA, Inc. (NASDAQ:RKLB) also successfully launched the 61st Electron Mission, which was the second launch for its Japanese customer, iQPS. The company also announced the successful orbit deployment of its third Pioneer spacecraft for Varda Space Industries, Inc.
6. Sidus Space, Inc. (NASDAQ:SIDU)
Weekly Gains: 12.28%
Sidus Space, Inc. (NASDAQ:SIDU) is engaged in the design, manufacture, launch, and data collection of commercial satellites.
While 2025 has been a difficult year for the company with a year-to-date share price decline of nearly 60%, the stock surged last week after Sidus Space, Inc. (NASDAQ:SIDU) announced the successful launch and deployment of LizzieSat (LS-3) into Low Earth Orbit. It was launched on March 14 as part of the Transporter-13 rideshare mission with SpaceX.
This is Sidus Space, Inc. (NASDAQ:SIDU)’s third satellite launch within a year, after LizzieSat-1 and 2, which have been in orbit since March and December 2024, respectively. With gains of 12.28% between March 10 and 17, SIDU is among the defense stocks that are gaining this week.
5. Planet Labs PBC (NYSE:PL)
Weekly Gains: 14.56%
Planet Labs PBC (NYSE:PL) provides global daily satellite imagery and geospatial solutions. It is among the defense stocks that are gaining this week.
On March 6, the company announced a strategic partnership with AI startup Anthropic, to leverage its large language model Claude to analyze Earth observation data. Planet Labs PBC (NYSE:PL) believes the integration, which will also involve its own daily geospatial data, has the potential to enable near real-time pattern recognition and detection on a global scale.
On March 11, Planet Labs PBC (NYSE:PL) signed another partnership with Syngenta, a leading global agritech firm, to enable farmers’ access to near-daily satellite imagery of their fields to monitor crop health, identify disease outbreaks, and detect pest infestations. These recent developments have attracted investor interest and resulted in impressive returns over the past week.
4. Karman Holdings Inc. (NYSE:KRMN)
Weekly Gains: 19.70%
Karman Holdings Inc. (NYSE:KRMN) specializes in the manufacturing and sale of mission-critical systems for missile, space, and defense programs.
The company’s share price has been all over the place since its debut on the NYSE in February. The stock has shown signs of volatility, going down for a few days before picking up again. Over the past week, Karman Holdings Inc. (NYSE:KRMN) returned gains of 19.70%, earning it a place in our list of the defense stocks that are gaining this week.
Karman Holdings Inc. (NYSE:KRMN)’s overall prospects look encouraging. Last month, President Trump signed an executive order to mandate the process of building an ‘American Iron Dome’, which presents an opportunity for the company to benefit, given its expertise in areas like hypersonic missile defense. Wall Street analysts are bullish on the stock with a consensus Strong Buy rating and an average share price upside potential of 12.61%.
3. Archer Aviation Inc. (NYSE:ACHR)
Weekly Gains: 22.21%
Archer Aviation Inc. (NYSE:ACHR) is an aerospace company, headquartered in San Jose, California, engaged in the development of eVTOL aircraft. It is also working on the development of a hybrid aircraft platform for the defense market.
The stock has surged by over 22% in the past week after the announcement of a strategic partnership between Archer Aviation Inc. (NYSE:ACHR) and Palantir Technologies to build the next-gen aviation software that utilizes artificial intelligence to improve air traffic control, route planning, and movement control.
Analysts believe the deal is likely to bolster Archer Aviation Inc. (NYSE:ACHR)’s footprint in the industry and could also attract interest from Gen Z investors who are looking for aviation stocks that deploy artificial intelligence.
2. Draganfly Inc. (NASDAQ:DPRO)
Weekly Gains: 31.67%
Draganfly Inc. (NASDAQ:DPRO) develops cutting-edge unmanned and remote data collection and analysis platforms and systems. With returns of 31.67% since March 10, it is among the defense stocks that are gaining this week.
Last week, the company announced the establishment of its new facility in Tampa, Florida, to strengthen national security and defense partnerships. It is strategically located close to major government and military clients and includes a live fire testing facility, which reaffirms Draganfly Inc. (NASDAQ:DPRO)’s commitment to delivering advanced drone solutions to US customers.
Draganfly Inc. (NASDAQ:DPRO)’s Tampa facility is part of its long-term strategy to enhance its government business. Analysts view the timing of its opening as critical amid ongoing geopolitical tussles.
1. Satellogic Inc. (NASDAQ:SATL)
Weekly Gains: 45.52%
Satellogic Inc. (NASDAQ:SATL) is a vertically integrated geospatial analytics company that delivers real-time insights for consumers, governments, and industries worldwide.
The stock has surged by over 250% in the last 6 months on the back of notable contract awards, which include a multi-year agreement with Brazil’s Air Force, signed in February, to provide low-latency satellite imagery for security operations within the country’s territory.
Satellogic Inc. (NASDAQ:SATL)’s share price dipped nearly 14% toward the end of February but has started picking up again, despite the company not making any headlines during the period. There is not much to suggest what caused the recent surge, but it may have been caused by the general upward trend in space stocks following a successful moon landing by a private US firm earlier this month.
Overall, Satellogic Inc. (NASDAQ:SATL) ranks first among the defense stocks that are gaining 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 SATL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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