Defense stocks had gained ground following the U.S.-Israel strikes on Iran over the weekend, which killed Iran’s supreme leader and officials, sparking retaliation fears and oil surges.
Pre-markets on Monday previously pointed to defense outperformance versus the Dow/S&P plunge; however, the volatility later subsided. Large-cap primes like Lockheed Martin (LMT) and Northrop Grumman (NOC) moved higher in extended hours on Friday. Besides, AeroVironment (AVAV) climbed 8.5% last week as investors reacted to the real-world deployment of its LOCUST counter-drone laser system at a U.S. airport.
Over 150 U.S. military cargo flights transported weapons and ammunition to the Middle East, and dozens of additional fighter jets were deployed within 24 hours.
Intuitive Machines (LUNR), Redwire (RDW), Red Cat Holdings (RCAT), and Karman (KRMN) also remained volatile with rising defense bids.
Broadly, funds like State Street SPDR S&P Aerospace & Defense ETF (XAR), iShares US Aerospace & Defense ETF (ITA), Global X Defense Tech ETF (SHLD), and Invesco Aerospace & Defense ETF (PPA) are used as vehicles for geopolitical plays.
The defense names have seen considerable gains so far this year, and here is a list of top defense names with their performance so far in 2026 and their Seeking Alpha Quant ratings:
- Lockheed Martin (LMT), YTD +36%, Quant Rating: 4.62
- Kratos Defense (KTOS), YTD +13.5%, Quant Rating: 4.44
- RTX Corporation (RTX), YTD +10.5%, Quant Rating: 4.36
- Karman (KRMN), YTD +20.4%, Quant Rating: 4.33
- Rocket Lab (RKLB), YTD -0.9%, Quant Rating: 3.38
- Redwire (RDW), YTD +19%, Quant Rating: 3.23
- Intuitive Machines (LUNR), YTD +1.5%, Quant Rating: 3.21
- Red Cat Holdings (RCAT), YTD +47%, Quant Rating: 3.14
- Mercury Systems (MRCY), YTD +22%, Quant Rating: 3.14
- Northrop Grumman (NOC), YTD +27%, Quant Rating: 3.02
- L3Harris Technologies (LHX), YTD +24% Quant Rating: 3.01
- General Dynamics (GD), YTD +6%, Quant Rating: 2.93
- AeroVironment (AVAV), YTD +4.3%, Quant Rating: 2.70
Top quant-rated defense ETFs:
- iShares US Aerospace & Defense ETF (ITA), YTD +13.5%, Quant Rating: 4.40
- Invesco Aerospace & Defense ETF (PPA), YTD +15.6%, Quant Rating: 4.39
- State Street SPDR S&P Aerospace & Defense ETF (XAR), YTD +17.3%, Quant Rating: 4.38
- Global X Defense Tech ETF (SHLD), YTD +15.5%, Quant Rating: 4.04
- Select STOXX Europe Aerospace & Defense ETF (EUAD), YTD +10.7%, Quant Rating: 3.67