In this article, we will list the 5 Best Defense Contractor Stocks to Buy Right Now. Please visit 8 Best Defense Contractor Stocks to Buy Right Now if you would like to to see the extended list and the methodology behind it.
5. L3Harris Technologies, Inc. (NYSE:LHX)
Stock Upside Potential: 14.80%
Number of Hedge Fund Holders: 48
L3Harris Technologies, Inc. (NYSE:LHX) is one of the best defense contractor stocks to buy right now. On March 24, L3Harris Technologies, Inc. (NYSE:LHX) began high‑volume production of its VAMPIRE counter‑drone systems in Huntsville, Alabama to meet growing demand from the U.S. and allies facing persistent drone threats.
The facility features flexible assembly, testing, and installation areas that allow VAMPIRE to be integrated onto vehicles and containerized weapon systems, with capacity to scale as needed. Company leaders emphasized the urgency of delivering these combat‑proven systems quickly to protect lives. VAMPIRE has already been used successfully in European operations since 2023, and in 2025, L3Harris expanded the family to include land, maritime, air, and electronic warfare variants.
Photo by Joel Rivera-Camacho on Unsplash
On March 18 at the JPMorgan Industrials Conference 2026, L3Harris Technologies outlined its strategic growth plans for the year.
At the top of the list is the planned initial public offering of the company’s Missile Solutions segment, as the company also eyes investments across various sectors to unlock growth opportunities. L3Harris Technologies is currently working on regulatory compliance as it seeks to close the IPO in the second half of the year.
In addition, the company plans to become the largest supplier of solid rocket motors. It already boasts a $20 billion pipeline, including $2 billion in contracts in South Korea. It has also inked a deal with a NATO ally as a customer. L3Harris Technologies projects high teen’s compound annual growth in margins through 2028, driven by revenue doubling.
The company delivered a 3% increase in revenue in 2025 to $21.9 billion, with diluted earnings per share of $10.73. For 2026, the company expects EPS to range between $11.30 and $11.50.
L3Harris Technologies, Inc. (NYSE:LHX) is a major American aerospace and defense contractor that provides advanced technology solutions across air, land, sea, space, and cyber domains. It specializes in tactical communications, electronic warfare, night vision equipment, and integrated mission systems (ISR) for government and commercial customers worldwide.
4. RTX Corporation (NYSE:RTX)
Stock Upside Potential: 16.70%
Number of Hedge Fund Holders: 79
RTX Corporation (NYSE:RTX) is one of the best defense contractor stocks to buy right now. On March 13, RTX secured a $2.01 billion contract modification from the US Air Force. The contract covers work on the Advanced Extremely High Frequency (AEHF) terminal system.
AEHF is a satellite communications system that delivers secure, jam-resistant communications for high-priority military assets. The modification is poised to increase the total value of the original contract signed in 2021 to $2.97 billion from $960 million. RTX is to conduct operations under the modification contract at the Marlboro, Massachusetts, and Largo, Florida, facilities.
The $2.01 modification contract comes on the heels of the US Navy awarding RTX a $498 contract last year for the production, testing, and delivery of fully integrated Navy Multiband terminals.
RTX has also confirmed that it has completed the expansion of its Redstone Raytheon Missile Integration facility. Completion of the 26,000-square-foot expansion follows a $115 million capital investment and is poised to increase the facility’s capacity by more than 50%.
RTX Corporation (NYSE:RTX) is a premier global aerospace and defense company that provides advanced systems to commercial, military, and government customers. It produces advanced weapons systems, such as the Tomahawk Land Attack Missile and the Patriot air defense system.
3. Leidos Holdings, Inc. (NYSE:LDOS)
Stock Upside Potential: 30.49%
Number of Hedge Fund Holders: 37
Leidos Holdings Inc. (NYSE:LDOS) is one of the best defense contractor stocks to buy right now. On March 11, Leidos Holdings Inc. (NYSE:LDOS) announced it is poised to modernize the US Air Force Cloud One Platform to enhance the deployment of secure cloud capabilities.
Under a $454.9 million contract, the company is to work with Amazon Web Services, Azure, Google Cloud Platform, and Oracle Cloud Infrastructure to transform the Air Force’s multi-cloud environment. The modernization drive seeks to boost security, increase automation, and simplify day-to-day operations to help the US Air Force deploy mission-critical operations faster. Leidos Holdings joins the fray as a trusted partner, owing to its edge in delivering innovative solutions that support the Air Force’s transition to the cloud.
Earlier on March 10, Leidos entered into a strategic partnership with Dropzone AI to help federal agencies respond to cyber threats faster and with less training. The two are to deploy agentic artificial intelligence to help handle routine cyber investigations, to allow humans to focus on more complex and critical threats.
Leidos Holdings, Inc. (NYSE:LDOS) is a technology company that provides scientific, engineering, and enterprise IT solutions primarily to U.S. federal agencies, including the Department of Defense and homeland security. It focuses on defense, intelligence, civil, and health markets, offering services such as AI, cybersecurity, digital modernization, and software development.
2. Rocket Lab Corporation (NASDAQ:RKLB)
Stock Upside Potential: 31.23%
Number of Hedge Fund Holders: 45
Rocket Lab Corporation (NASDAQ:RKLB) is one of the best defense contractor stocks to buy right now. On March 23, Rocket Lab Corporation (NASDAQ:RKLB) inked a $190 million contract for HASTE launches. It represents the single largest launch contract in the company’s history, bringing the total launch backlog to more than 70.
Under the $190 million contract, the company is to support the US Department of Defense’s initiative to accelerate hypersonic flight testing. The test flights are to occur over a four-year period. The multi-year launch partnership builds on the company’s success in delivering high-cadence hypersonic capabilities at scale.
The company continues to assert its commercial responsiveness and precision that hypersonic programs demand, with a 100% mission success rate across all HASTE launches. It has already sold 28 new launches in Q1 2026, almost as many as it sold last year. The exponential growth underlines Electron’s role as the small launch vehicle of choice for commercial, civil, and defense missions.
Rocket Lab Corporation (NASDAQ:RKLB) provides defense services as a prime contractor for the U.S. Space Development Agency (SDA), designing and manufacturing 18 missile-tracking satellites. It specializes in launching rapid-response satellites via Electron rockets, conducting hypersonic test flights (HASTE), and supplying military-grade space systems.
1. AeroVironment Inc. (NASDAQ:AVAV)
Stock Upside Potential: 46.89%
Number of Hedge Fund Holders: 40
AeroVironment, Inc. (NASDAQ:AVAV) is one of the best defense contractor stocks to buy right now. On March 23, analysts at BTIG reiterated a Buy rating on AeroVironment, Inc. (NASDAQ:AVAV) and a $330 price target.
The positive stance is in response to the company receiving two firm-fixed-price contracts. Under the $117 million contract, the company is to deliver P550 long-range reconnaissance uncrewed aerial vehicles (UAVs) to the US Army. The contract includes finding unmanned aerial systems, battery chargers, ground control stations, launchers, and training materials.
The Red Dragon contract seeks to support the Army’s Long Range Reconnaissance program and represents the first contract for the company’s one-way platform. AeroVironment’s management is confident the platform will scale to Switchblade-like levels by the end of the decade.
According to BTIG, the latest contract underlines momentum across the company’s Autonomous Systems segment. Earlier in the month, the company secured a $97.4 million contract under the U.S. Army’s Aviation and Missile Technology Consortium (AMTC). The contract is for the development and delivery of a Generative Environment for the Next Era of Spectral Imaging Stimulators (GENESIS).
AeroVironment Inc. (NASDAQ:AVAV) is a leading defense technology company specializing in intelligent, multi-domain robotic systems, including small unmanned aircraft systems (UAS), tactical missile systems, and unmanned ground vehicles.
While we acknowledge the potential of AVAV to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AVAV and that has 100x upside potential, check out our report about the cheapest AI stock.
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