Good morning!
Today’s dispatch stems from a private discussion with a friend about military stocks. We’ll examine the broader defense sector and round up some of this year’s best-performing defense names…
Amentum Holdings, Inc. ($AMTM)
Originally covered by me on March 31, 2025 in this Medium article, Amentum Holdings, Inc. specializes in mission critical infrastructure, cybersecurity, and defense contracting.
One of the firm’s most attractive features is the fact that it operates the “Waste Isolation Pilot Plant” in New Mexico. This is the only deep geological repository licensed to store radioactive waste in the United States. Amentum also operates the Nevada Test and Training Range, a military training area used by the United States Air Force Warfare Center. And, the company recently helped bring the UK’s newest nuclear reactor online.
Amentum Holdings, Inc. is up 38.09% year-to-date and 64.34% since I covered it on Medium.
Some added good news, this stock is still cheap at a price to earnings ratio of 12.46.
Huntington Ingalls Industries, Inc. ($HII)
“A fallen legend.” That’s how I described Huntington Ingalls Industries, Inc. in this Medium article published on March 1st, 2025. Huntington Ingalls Industries is the sole provider of nuclear-powered aircraft carriers for the United States Navy. It's also one of two companies that make U.S. Navy submarines.
Earlier this year, Wall Street was panicking that government cutbacks would affect this stock. An incredibly stupid belief that made exactly zero logical sense.
As expected, the U.S. government did not cancel its submarine, aircraft carrier, or military equipment contracts. Huntington Ingalls Industries is now up 89.46% year-to-date and 102.44% since publishing the Medium article.
I bring this up because defense stocks are back in the news and Wall Street loves them again. Here are just a few headlines published in the last week:
“The US Military Will Enjoy a Record-Breaking Budget in 2026”
“US sets record defense budget but imposes limits on Trump's military ambitions”
“Trump announces new class of U.S. battleships named after himself”
“Trump announces plans for new Navy ‘battleship’ as part of a ‘Golden Fleet’”
“Hegseth Says Shipbuilding, Golden Dome, Nuclear Deterrence Make Up DOD Budget Request for Billions in Funding”
Staying abreast of current events is important. But, some of the best investment opportunities come from the dog that didn’t bark. When defense stocks were unloved and largely ignored, they offered great value, with several major players trading at dirt-cheap valuations.
Now that the sector is back in the spotlight and Wall Street's enthusiasm has returned, it may be a good idea to shift your attention towards other unloved industries that the media currently ignores.
As Jim Rogers once said, “Nearly every time I strayed from the herd, I've made a lot of money. Wandering away from the action is the way to find the new action.”
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Thank you for reading and have an outstanding weekend!
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Disclaimer: This article is for entertainment purposes only. It is not financial advice, always do your own research.
