2026 started with a bang! for defense investors. The month of January saw the U.S. Defense Security Cooperation Agency -- or DSCA, the Pentagon's personal international arms dealer -- submit no fewer than 11 separate arms deals to Congress for approval, totaling $22.5 billion in combined value.
Denmark is buying Hellfire missiles from Lockheed Martin (LMT +0.78%). Israel is ordering helicopters from Leonardo USA. Spain requires assistance from multiple U.S. defense companies to upgrade its fleet of F-100 frigates -- and these are among the smaller arms deals in the works.
Among the larger awards handed out...
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$9 billion for Lockheed in Saudi Arabia
Arguably, the biggest beneficiary of the flurry of early 2026 arms deals is defense giant Lockheed Martin, the world's largest pure-play defense contractor. On Jan. 30, DSCA notified Congress of a planned sale of 730 PATRIOT Advanced Capability-3 Missile Segment Enhancement (PAC-3 MSE) missiles and related equipment to the Kingdom of Saudi Arabia.
In total, the contract should be worth $9 billion. While RTX Corporation is closely involved in PATRIOT, building the radar systems that enable it to shoot down hostile aircraft and missiles, Lockheed was named the sole principal contractor on this contract.
$2.3 billion for Boeing in Singapore
Ten days before that award, Boeing (BA 3.91%) notched a win when DSCA told Congress that the nation of Singapore wants to buy four P-8A Poseidon patrol aircraft and arm them with eight MK 54 Lightweight Torpedoes.
The aircraft presumably make up the majority of the $2.3 billion value of this contract, meaning Boeing should win the bulk of that money. RTX makes the MK 54, but in this particular case, DSCA says it will supply Singapore with torpedoes from Pentagon stockpiles -- meaning no extra revenue for RTX on this contract, either.
$3.8 billion for Boeing and Lockheed in Israel
The other really big contract last month went to Boeing and Lockheed, both of which are named principal contractors. For $3.8 billion, Israel will be ordering up 30 AH-64E Apache attack helicopters -- plus "related equipment." Boeing builds the birds themselves, while Lockheed and its partner Northrop Grumman provide the Longbow Fire Control Radars that help the Apaches shoot straight (and are also part of Israel's order).
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Key Data Points
Boeing and Lockheed won't keep all the loot. In addition to Northrop taking a cut, DSCA notes that Israel needs 70 T700-GE 701D engines to fly the Apaches, and Boeing will have to buy those from its engine supplier, GE Aerospace.
What does this mean for investors?
As I read these contracts, it appears Lockheed Martin is the defense company benefiting most from January's defense contracts. Although I expect Boeing will take most of the money from the Apache sale and essentially all the cash from selling Poseidons to Singapore, Boeing's defense division remains unprofitable.
Lockheed's Missiles and Fire Control (MFC) division, in contrast, which will build both Saudi Arabia's Patriot missiles and the Longbow fire controls for Israel's new helicopters, is in fact the company's most profitable division. According to data from S&P Global Market Intelligence, Lockheed MFC earned 13% margins on its revenue in 2025.
Advantage: Lockheed Martin stock.
