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Even though the defense industry does not usually possess high growth prospects, shares of defense companies provide stability thanks to their long-term contracts with governments. Senate appropriators recently unveiled plans for approximately $24 billion in extra military spending—above the president’s $715 billion budget request—for the Fed’s fiscal year 2022. Furthermore, the government’s planned procurement of advanced military equipment to replace aging equipment currently in service, along with technological advances, are expected to accelerate the growth of the defense sector. So, both EADSY and BA should benefit.
EADSY has gained 16.6% in price over the past nine months, while BA has returned 8%. Also, EADSY’s 20.4% gains year-to-date are significantly higher than BA’s 4.9% returns. Moreover, EADSY is the clear winner with 14.4% gains versus BA’s negative returns in terms of the past six months’ performance.
