What is the top defense stock?

Lockheed Martin is both the largest pure-play defense company and the one with the greatest revenue diversity across different agencies and platforms. Although it doesn't always outperform in the near term, it is the top choice among defense stocks for long-term-focused investors.

Are defense stocks a good buy?

Defense stock valuations tend to be tied to government spending, which can mean periods of underperformance. However, over the long run, defense stocks offer growth rates higher than inflation and steady dividend income, making them a solid choice for investors seeking stability and income in their portfolios.

What are the most undervalued defense stocks?

Leidos Holdings is the most undervalued among the major defense stocks, with a price-to-earnings (P/E) ratio of 12.65 in early May 2026. Defense IT specialists tend to trade at a discount to some of the more diversified contractors.

Which defense stocks pay dividends?

Most established defense companies, with the exception of Boeing, pay dividends, and Boeing will likely seek to pay a dividend again in the future. Among defense stocks, Lockheed Martin paid the highest dividend in May 2026, with a 2.6% yield.

Who is the biggest defense contractor?

Lockheed Martin is the biggest defense contractor in terms of defense-specific revenue, but both Boeing and RTX have larger market caps thanks to their presence in both defense and commercial aerospace.

How does the U.S. defense budget affect defense stocks?

Defense spending makes up about 13% of the total U.S. budget, and procurement -- the actual buying of weapons and other supplies -- is about 17% of total defense spending. The U.S. defense budget provides most of the funding for these defense companies, and there are winners and losers each year when the budget is released. However, typically, there are no volatile reactions from the stocks. Defense procurement is a multiyear endeavor, meaning no one year is make-or-break for a defense contractor. Investors should look at big-picture trends over time, such as rising defense spending or lawmakers prioritizing other areas, for clues on how stocks might move in the future.

What defense stock does Warren Buffett own?

Historically, Buffett has not been an active defense investor. But in 2024, Berkshire Hathaway (NYSE:BRKB) invested in Heico (NYSE:HEI), an aerospace component company that has significant exposure to defense.

Best Defense Stocks to Buy in 2026 and How to Invest

Best Defense Stocks to Buy in 2026 and How to Invest in Them

By Lou Whiteman – Updated May 8, 2026 at 3:08 PM EST | Fact-checked by Frank Bass

Key Points

U.S. government's consistent funding gives predictability to defense sector investments.
Defense stocks like Lockheed and Boeing vary in stability and sectors served.
Investing? Check for dividend yields and government contract types for insights.

Defense companies get the bulk of their revenue from one customer -- the U.S. government. Fortunately, that customer has deep pockets and a long history of paying its bills. The federal government's stability provides defense companies and investors with some predictability when managing cash and projecting growth.

Companies in the defense sector offer a wide range of products and services to their main customer, and some are better investments than others. Here's what you need to know about investing in the defense sector and how to pick where your money should go.

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Soldiers in uniform with weapons backlit by sunset. — Image source: Getty Images.

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Ticker Information Table
Name and ticker	Current price	Market cap	Dividend yield
Lockheed Martin (NYSE:LMT)	$513.16	$119.1 billion	3.28%
Boeing (NYSE:BA)	$217.70	$176.8 billion	0.00%
Northrop Grumman (NYSE:NOC)	$536.59	$76.6 billion	2.17%
General Dynamics (NYSE:GD)	$337.61	$91.7 billion	1.80%
RTX (NYSE:RTX)	$174.26	$234.9 billion	1.59%
Leidos (NYSE:LDOS)	$126.82	$16.1 billion	1.30%
L3Harris Technologies (NYSE:LHX)	$308.12	$57.7 billion	1.57%
AeroVironment (NASDAQ:AVAV)	$204.49	$10.2 billion	0.00%

Data as of Jun 2, 2026. Showing 8 of 8 total entries.

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NYSE: LMT

Lockheed Martin

Today's Change

(-0.65%) $-3.34

Current Price

$513.16

Key Data Points

Market Cap

$119B

Day's Range

$510.20 - $516.55

52wk Range

$410.11 - $692.00

Volume

29.1K

Avg Vol

1.5M

Gross Margin

10.70%

Dividend Yield

3.28%

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Lockheed Martin (LMT -0.59%) is the world's largest defense company and the U.S. government's biggest contractor. It's also the lead contractor on the F-35 Joint Strike Fighter, the world's most expensive airplane.

Lockheed's legendary Skunk Works research facility in California is world-renowned. The company has leveraged its research muscle to become a leader in advanced fighter planes, high-tech missiles, and cutting-edge electronics.

2. Boeing

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NYSE: BA

Boeing

Today's Change

(-2.94%) $-6.60

Current Price

$217.70

Key Data Points

Market Cap

$177B

Day's Range

$215.01 - $224.69

52wk Range

$176.77 - $254.35

Volume

7.7M

Avg Vol

Gross Margin

4.83%

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Boeing (BA -2.94%) is best known for its commercial airplanes, but its defense business, though accounting for just one-third of total company revenue, is large enough to rank among the industry's titans. Boeing makes several aircraft and helicopters for the Pentagon and is involved in space pursuits. The company's defense business has also branched out into autonomous submarines and other products.

Boeing has been a tough stock to own since the beginning of the decade, and the shares are still significantly below their 2019 high. Troubles remain on the commercial side of Boeing, but the company remains an important vendor to the U.S. government. If Boeing can successfully work through the operational troubles that have plagued it, there is significant upside potential for the stock.

3. Northrop Grumman

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NYSE: NOC

Northrop Grumman

Today's Change

(-0.49%) $-2.63

Current Price

$536.59

Key Data Points

Market Cap

$77B

Day's Range

$531.80 - $538.43

52wk Range

$472.02 - $774.00

Volume

1.3M

Avg Vol

837.9K

Gross Margin

20.52%

Dividend Yield

2.17%

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Northrop Grumman (NOC -0.49%) is responsible for stealth bombers and has a large space portfolio. The company is closely tied to the nuclear triad -- a combination of nuclear missiles, bombers, and submarines able to strike back if the nation is attacked.

Northrop is the second-largest stand-alone defense contractor and, in years past, would sometimes be overlooked in favor of Lockheed Martin. But Northrop Grumman's portfolio is more closely tied to key Pentagon priorities, including the triad, making it a good option for investors seeking predictable growth in the years to come.

4. General Dynamics

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NYSE: GD

General Dynamics

Today's Change

(-0.47%) $-1.59

Current Price

$337.61

Key Data Points

Market Cap

$92B

Day's Range

$335.77 - $340.29

52wk Range

$268.10 - $369.70

Volume

961.8K

Avg Vol

1.3M

Gross Margin

15.24%

Dividend Yield

1.80%

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NYSE: RTX

RTX

Today's Change

(-0.09%) $-0.15

Current Price

$174.26

Key Data Points

Market Cap

$235B

Day's Range

$172.99 - $175.75

52wk Range

$135.43 - $214.50

Volume

4.4M

Avg Vol

5.6M

Gross Margin

20.21%

Dividend Yield

1.59%

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RTX (RTX -0.09%), formerly Raytheon Technologies, doesn't make warships or fighters. However, it does have a role in a wide range of important military platforms led by other contractors. It is the product of the 2020 merger between Raytheon, a defense electronics and missile specialist, and United Technologies, which makes aircraft engines and various other aerospace parts.

The Pentagon has drawn down its weapons stockpile in recent years, which should lead to significant demand for missiles and other RTX goods in the years to come. The company also benefits from upside in its commercial business, which has experienced a multiyear cycle of strong demand for spare parts to keep the existing aviation fleet aloft.

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6. Leidos Holdings

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NYSE: LDOS

Leidos

Today's Change

(-0.70%) $-0.90

Current Price

$126.82

Key Data Points

Market Cap

$16B

Day's Range

$123.25 - $127.66

52wk Range

$121.20 - $205.77

Volume

1.5M

Avg Vol

1.2M

Gross Margin

17.91%

Dividend Yield

1.30%

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Leidos Holdings (LDOS -0.70%) is a large IT contractor that has also actively expanded into hardware, providing the electronics and brains for autonomous ships and building a strong portfolio of classified research capabilities geared toward the intelligence and space communities.

The push to make government more efficient comes with both risks and rewards for these IT companies. Leidos and other IT companies specialize in providing services that were once done in-house at lower cost, creating opportunities. But government watchdogs aiming to cut costs will be looking closely at these contracts for ways to save.

7. L3Harris Technologies

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NYSE: LHX

L3Harris Technologies

Today's Change

(-0.47%) $-1.47

Current Price

$308.12

Key Data Points

Market Cap

$58B

Day's Range

$307.17 - $310.49

52wk Range

$237.56 - $379.23

Volume

804.4K

Avg Vol

1.4M

Gross Margin

22.19%

Dividend Yield

1.57%

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L3Harris Technologies (LHX -0.47%) was formed from the 2019 merger of Harris Corp. and L3 Technologies. Both were defense electronics and sensor suppliers that hoped to leverage their combined scale to better compete with the larger contractors for prime positions on defense contracts.

The company has spent most of the decade streamlining its portfolio and investing in new technologies. Today, it is a major vendor of tactical communications and reconnaissance systems, night-vision equipment, complex space sensors, and other defense electronics products.

8. AeroVironment

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NASDAQ: AVAV

AeroVironment

Today's Change

(0.20%) $0.40

Current Price

$204.49

Key Data Points

Market Cap

$10B

Day's Range

$197.00 - $204.49

52wk Range

$156.00 - $417.86

Volume

36K

Avg Vol

1.7M

Gross Margin

18.88%

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Best defense stocks: FAQ

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About the Author

Lou Whiteman is a contributing Motley Fool stock analyst covering aerospace, defense, transport, manufacturing, specialty finance, and bank stocks. Previously, Lou was a financial analyst and senior writer for TheStreet, a venture capital specialist for The Deal LLC, and a high school personal finance teacher. He holds a bachelor’s degree in communications from Loyola University Maryland and completed a fellowship at the ABA Stonier Graduate School of Banking.

TMFLouWhiteman

@louwhiteman

Lou Whiteman has positions in General Dynamics, L3Harris Technologies, Leidos, and Lockheed Martin. The Motley Fool has positions in and recommends AeroVironment, Boeing, L3Harris Technologies, Leidos, and RTX. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

Best Defense Stocks to Buy in 2026 and How to Invest in Them

Key Points

Key Data Points

2. Boeing

Key Data Points

3. Northrop Grumman

Key Data Points

4. General Dynamics

Key Data Points

Key Data Points

6. Leidos Holdings

Key Data Points

7. L3Harris Technologies

Key Data Points

8. AeroVironment

Key Data Points

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Best defense stocks: FAQ

What is the top defense stock?

What is the top defense stock?

Are defense stocks a good buy?

Are defense stocks a good buy?

What are the most undervalued defense stocks?

What are the most undervalued defense stocks?

Which defense stocks pay dividends?

Which defense stocks pay dividends?

Who is the biggest defense contractor?

Who is the biggest defense contractor?

How does the U.S. defense budget affect defense stocks?

How does the U.S. defense budget affect defense stocks?

What defense stock does Warren Buffett own?

What defense stock does Warren Buffett own?

About the Author

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Best defense stocks: FAQ

What is the top defense stock?

What is the top defense stock?

Are defense stocks a good buy?

Are defense stocks a good buy?

What are the most undervalued defense stocks?

What are the most undervalued defense stocks?

Which defense stocks pay dividends?

Which defense stocks pay dividends?

Who is the biggest defense contractor?

Who is the biggest defense contractor?

How does the U.S. defense budget affect defense stocks?

How does the U.S. defense budget affect defense stocks?

What defense stock does Warren Buffett own?

What defense stock does Warren Buffett own?

Best Nuclear Energy Stocks in 2026 and How to Invest

Best Cybersecurity ETFs to Buy in 2026 and How to Invest

Best Renewable Energy Stocks to Buy in 2026 and How to Invest in Them

Best Biotech Stocks to Buy in 2026 and How to Invest in Them

Key Data Points

Top eight defense stocks to consider

1. Lockheed Martin

6. Leidos Holdings

Related investing topics

FAQ

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Key Data Points

How to find the best defense stocks

Listen to the customer

Follow the numbers

Benefits and risks of investing in defense stocks

Benefits

Risks

Key trends in the defense industry

Defense stocks vs. defense ETFs