Defense stocks have been in a downdraft heading into the new year. President Trump’s intent to de-escalate geopolitical conflicts and end the war in Ukraine with funding cuts is causing concern throughout the aerospace sector. The world's largest defense contractor, Lockheed Martin Co. (NYSE: LMT), shares tumbled 22% in just over two months from its high of $618.95 on Oct. 21, 2024, to $481.82 on Jan. 3, 2025.
The B-2 stealth bomber manufacturer Northrup Grumman Co. (NYSE: NOC) also saw its stock crumble 15.8% in three months from its $555.57 swing high on Oct. 1, 2024, to $467.82 on Jan. 3, 2024. Aerospace giant Raytheon Technologies Co. (NYSE: RTX) stock has weathered the sell-off better, dropping just 10% from its swing high of $128.70 to $115.83 during the same period. It’s no coincidence that Raytheon is holding up better than its peers. Thanks to a broader diversification of products, Raytheon may actually be the best defense and aerospace stock of 2025.
