5 Aerospace & Defense Stocks Ready for Liftoff

Key Points

• The industrial sector has outperformed YTD, up almost 7%, outpacing the overall market's increase of 5.6%.
• Within the sector, the aerospace & defense industry has outperformed amid economic and political uncertainties.
• Breakout candidates within the industry include LMT, XON, GD, RTX, and HWM, all of which are currently trading near 52-week highs.

https://www.marketbeat.com/stocks/NYSE/HWM/Year-to-date, the industrials sector has demonstrated significant outperformance, surging by over 7% compared to the benchmark SPY ETF, which has seen a more modest increase of just over 5.6%. 

Stocks in the aerospace and defense industries have notably amplified this trend, with numerous industry leaders achieving double-digit gains year-to-date. This remarkable sector performance and exceptional industry outperformance can be attributed to escalating economic and political uncertainties. Primarily, these uncertainties stem from dwindling probabilities of multiple rate hikes by the Federal Reserve this year and the sustained and escalating tensions in the Middle East, compounded by the ongoing conflict in Ukraine and the resultant rise in gas prices.

Against this backdrop of heightened volatility and outperformance thus far in the year, several aerospace and defense stocks are showing promising signs of a breakout. Here are five stocks within the industry that appear primed to sustain their upward momentum.

5 Aerospace & Defense Stocks Ready for Liftoff

Lockheed Martin Corp. 

Lockheed Martin NYSE: LMT, while not exhibiting year-to-date sector or market outperformance, is currently consolidating above rising Simple Moving Averages (SMAs), positioned just under 3% below its 52-week high, signaling a potential breakout. With anticipated earnings growth of 8.03%, robust dividend growth, and a projected upside of over 4% based on consensus price targets, investor interest remains high. The company recently reported earnings on April 23, surpassing expectations on both revenue and EPS, further bolstering investor confidence in its performance trajectory.

Axon Enterprise Inc.

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