14 Best Aerospace and Defense Stocks to Buy According to Wall Street Analysts

Core Insights - The aerospace and defense industry is currently presenting significant investment opportunities due to geopolitical tensions, particularly in the Middle East and the ongoing conflict between Russia and Ukraine, as well as potential U.S. military actions in Venezuela [1] Industry Performance - The S&P Aerospace and Defense Select Industry Index has outperformed the broader S&P 500 index, gaining 40% year-to-date compared to the S&P 500's 16% increase [2] - Despite high year-to-date gains, there are concerns about valuations in the aerospace and defense sector being near their peak, although data suggests potential for further upside [2] Market Demand - Global air traffic data indicates a 5.8% increase in air passenger traffic, driven by strong demand for both passenger and defense-linked aircraft, which is expected to bolster the aerospace industry [3] Government Funding - The One Big Beautiful Bill Act is projected to inject $156.2 billion into national security and defense priorities, with overall defense and military spending anticipated to exceed $849 billion, creating new opportunities for companies in the sector [4][5] Company Highlights - Northrop Grumman Corp. (NYSE:NOC) is highlighted as a top aerospace and defense stock, with a 20.55% upside potential according to analysts. The company recently secured a $100 million contract for missile weapon systems development [9][10] - Boeing (NYSE:BA) is also noted as a strong investment, with a 20.72% upside potential. The company recently won a $930.77 million contract to extend the service life of F/A-18 E/F Super Hornets [15][19]