In this article, ChatGPT Stock Advice: Top 8 Defense Stocks, we discuss the top defense stocks highlighted by ChatGPT.
According to new data released by Intuit Credit Karma in September of this year, 66% of Americans surveyed who had previously used generative AI reported using it for financial advice, with the percentage rising to 82% for Gen Z and Millennials.
Those turning to generative AI for financial guidance use it for a wide range of topics, from financial education and personal finance to complex areas such as investing and filing tax returns. Approximately 32% of those surveyed reported using the technology for stock market investing.
Approximately 85% of the respondents said that they put the financial recommendation into practice. Among them, 81% said they felt more confident about financial decision-making due to generative AI, and 80% said that their financial positions had improved due to the advice.
However, it does not come without risk; approximately 52% of the respondents who acted on the suggestion report having made a poor financial decision or mistake based on the information provided.
Earlier in the year, a report by Investing in the Web, a website that helps investors select online investment platforms, stated that a group of researchers had asked 100 finance-related questions to ChatGPT, with the platform responding to 35% of the questions incorrectly and one-third of the answers being hallucinations.
In a YouTube interview with MIT OpenCourseWare in April of this year, American economist Andrew W. Lo cited hallucination problems with large language models and stated that these models were not yet ready to assist investors in making financial decisions.
However, he added that platforms like ChatGPT are still useful for helping users think through general financial issues more seriously, such as asking the tool about areas to focus on for retirement, products and services that could be best utilized for financial information, and more.
Before shifting focus to ChatGPT’s stock advice for defense stocks, it is worth noting that several stocks in the sector have surged over the last couple of weeks, following their upward revisions to 2025 outlooks amid higher demand, despite tariffs and ongoing economic uncertainty.
Military spending has soared worldwide, with wars in Ukraine and Gaza intensifying and luring investors towards the sector. Another critical driver of the ongoing momentum has been the rising defense budgets of European countries, particularly after President Trump took office in January, prompting Europe to increase its defense spending.
While traditional contractors continue to gain, smaller firms have also emerged as standout performers this year, with surging demand for next-generation, low-cost military technology as nations modernize their militaries with AI-powered drones and unmanned vehicles that are cheap and cut dependence on ground forces.
Jon Siegmann, who covers the aerospace and defense industry for Stifel, told Reuters in September that winners in the new market, shaped by agile and adaptable combat systems, will be firms that invest in affordable, upgradable, and software-backed systems.
Let’s now head over and discuss what ChatGPT suggests are the top 8 defense stocks to invest in right now.
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Our Methodology
We prompted ChatGPT to identify the top 8 defense stocks to invest in right now and to explain the reasoning behind each stock’s selection. According to the platform, its selection was based on rankings of several factors, including exposure to defense budgets, growth prospects, market positioning, valuation, shareholder return profile, and relative risk. The stocks in this article are ranked in the same order as provided by ChatGPT on October 28, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
ChatGPT Stock Advice: Top 8 Defense Stocks
8. AeroVironment, Inc. (NASDAQ:AVAV)
Number of Hedge Fund Holders: 31
AeroVironment, Inc. (NASDAQ:AVAV) is among the top 8 defense stocks based on ChatGPT’s advice. On October 23, BofA lifted its price target for the stock to $450 from $300, while maintaining a Buy rating for its shares.
The adjustment followed the firm’s meeting with both the management and customers at the 2025 AUSA conference, where the company unveiled Switchblade 400, a new loitering munition, which is attracting interest from customers worldwide. It was put on display alongside new variants of existing drones, including the Switchblade 300 Block 20 and the Switchblade 600 Block 2.
Separately, a report in the defense magazine, Janes, on October 13 said that AeroVironment, Inc. (NASDAQ:AVAV) submitted the new munition in response to a request for proposal (RFP) by the U.S. Army for an unmanned anti-tank weapon for its Low Altitude Stalking and Strike Ordnance (LASSO) program.
According to TheFly, BofA also visited the company’s Space, Cyber, and Directed Energy facility recently. The firm has reassured an earlier positive assessment of the BlueHalo acquisition, stated that the price target increase was based on higher growth and a stronger multiple.
Earlier in the month, on October 7, Canaccord Genuity also raised AeroVironment, Inc.’s (NASDAQ:AVAV) price target to $430 from $305 and kept a Buy rating for its shares. The revision came after the firm attended the company’s Investor Open House, where the management estimated $75 billion in total addressable market (TAM) by FY 2030 across its product catalog.
Overall, Wall Street analysts have a consensus Buy rating for the stock and a one-year average share price target of $409, representing a 7% upside potential from the close on October 29.
AeroVironment, Inc. (NASDAQ:AVAV) designs and manufactures unmanned aerial vehicles, ground robot systems, and loitering munition systems.
7. Booz Allen Hamilton Holding Corporation (NYSE:BAH)
Number of Hedge Fund Holders: 47
Booz Allen Hamilton Holding Corporation (NYSE:BAH) is among the top 8 defense stocks based on ChatGPT’s advice. On October 24, the company posted weak financial results for the second quarter of fiscal 2026, which resulted in several firms slashing their price targets for the stock.
Top and bottom-line performance both came in below forecast, due to what the company described as a ‘continued funding slowdown’. Revenue declined 8.1% year-over-year to $2.9 billion, while net income was down 55.1% from the prior year’s period to total $175 million. Booz Allen also announced that it was trimming its full-year outlook.
Following the earnings call, Stifel lowered its price target to $106 from $119 and maintained a Hold rating on its shares. According to TheFly, the analyst noted that this was the second instance in three months that the management’s outlook for the year was worse than anticipated.
The firm added that, although the environment was not worsening, it was still far from normalizing for the company. Considering the volatility and uncertainty around the market environment for government services, Stifel told investors that it favors stocks that are not encountering the same level of market declines.
Goldman Sachs’ Noah Poponak, on October 27, cut Booz Allen Hamilton Holding Corporation (NYSE:BAH)’s price target to $80 from $93, while keeping a Sell rating for its shares. In a research note to investors, the analyst noted the weak financial performance and discussed how government funding re-prioritization was adversely affecting the company.
Poponak further added that Goldman continues to anticipate risk to margins as customers consider shifting greater risk to companies through contract terms. On the same day, UBS also reduced its price target for the stock to $93 from $115, while maintaining a Neutral rating for the company’s shares.
Booz Allen Hamilton Holding Corp. (NYSE: BAH) provides solutions in artificial intelligence, cybersecurity, analytics, digital engineering, and mission-critical IT services to the U.S. government.
6. Huntington Ingalls Industries, Inc. (NYSE:HII)
Number of Hedge Fund Holders: 36
Huntington Ingalls Industries, Inc. (NYSE:HII) is among the top 8 defense stocks based on ChatGPT’s advice. On October 30, the company reported financial results for the third quarter of fiscal 2025, with record third quarter sales of $3.2 billion, up 16.1% year-over-year, driven by strong growth across the Ingalls Shipbuilding, Newport News Shipbuilding, and Mission Technologies divisions.
Diluted earnings per share came in at $3.68, up nearly 44% from the prior year’s quarter, and beating estimates of $3.29 per share. Segment operating income stood at $179 million, with a margin of 5.6%, up from $97 million and 3.5% in Q3 2024. The company attributed the improvement to favorable results at Newport News Shipbuilding and Ingalls Shipbuilding.
Robust financial results during the quarter were also supported by substantial throughput gains at the company’s shipyards, resulting in an 18% increase in year-over-year shipbuilding sales. President and CEO Chris Kastner’s tone during the earnings call reflected confidence that HII and Navy’s investments in workforce, supply chain, and infrastructure will yield positive results for throughput ahead.
Kastner stated that Huntington Ingalls Industries, Inc. (NYSE:HII) is expecting to achieve a 15% throughput improvement for fiscal 2025, with enhancement efforts accelerating throughput throughout the year. The company has hired 4,600 shipbuilders this year and has seen an improvement in retention rates at both shipyards.
There has also been a growth in experienced hires following the wage investment this year, as well as increased hiring from regional workforce development pipelines. Moreover, the company is expanding its industrial base through its distributed shipbuilding strategy, which includes outsourcing at several partner sites, likely leading to increased throughput and improved schedule adherence.
In other related news, Huntington Ingalls Industries, Inc. (NYSE:HII) secured $2 billion in new contract awards during the recent quarter, increasing its total backlog to $55.7 billion as of September 30, 2025.
Following the earnings call, TD Cowen lifted its price target to $350 from $320 and kept a Buy rating on its shares, while Goldman Sachs raised HII’s price target to $356 from $316 and maintained a Buy rating on the company’s shares.
The company’s recent share price performance has buoyed investors. Diamond Hill Select Fund stated the following regarding Huntington Ingalls Industries, Inc. (NYSE:HII) in its third quarter 2025 investor letter:
“Among our top individual contributors in Q3 were Mr. Cooper Group and Huntington Ingalls Industries, Inc. (NYSE:HII). US Department of Defense (DOD) and Navy supplier Huntington Ingalls is seeing early signs of progress from its recent efforts to improve employee attrition. We continue to believe Huntington Ingalls is one of the best positioned defense companies to meet the DOD’s need to prepare for a potential conflict in the Pacific — which should ensure strong demand for the next five-plus years. Furthermore, as its recent labor issues abate, the company should be able to improve margins over time.”
Huntington Ingalls Industries, Inc. (NYSE:HII) is an American defense company with expertise in shipbuilding. The stock has had impressive returns in 2025, gaining 71.64% year-to-date as of the close on October 31.
5. L3Harris Technologies, Inc. (NYSE:LHX)
Number of Hedge Fund Holders: 53
L3Harris Technologies, Inc. (NYSE:LHX) is among the top 8 defense stocks based on ChatGPT’s advice. On October 30, the company reported strong results for the third quarter of fiscal 2025 and announced an increase in its full-year financial guidance.
LHX’s revenue was reported at $5.7 billion, up 7% year-over-year and 10% organically, amid growth across all segments, driven by increased international demand, higher volume on ongoing programs, and new programs ramping up. Operating margin stood at 11%, while the adjusted segment operating margin was reported at 15.9%.
The financial results marked the 8th successive quarter of year-over-year expansion in adjusted segment operating margin. During the earnings call, the company credited the recent quarter’s margin expansion to LHX NeXt cost savings across segments and improved program performance.
L3Harris Technologies, Inc.’s (NYSE:LHX) diluted EPS for the quarter was $2.70, improving 10% from the prior year and beating estimates by 12 cents. The company received $6.7 billion in orders during the quarter, resulting in a book-to-bill ratio of 1.2x.
Chairman and CEO Christopher Kubasik believes the firm is on track to meet its 2026 financial framework and deliver long-term profitable growth, amid a record pipeline, growing demand, and timely investments in areas like space and munitions.
Following the earnings call, on October 31, Susquehanna lifted its price target on the stock to $350 from $320 and maintained a Positive rating on its shares. The analyst believes the company is well-placed to secure future contract awards.
On the same day, UBS also raised its price target for LHX to $323 from $318, while maintaining a Neutral rating on its shares. In a research note to investors, the analyst said the company was experiencing growing momentum across multiple areas.
L3Harris Technologies, Inc. (NYSE:LHX) provides end-to-end technology solutions connecting the air, land, space, sea, and cyber domains in national security. The stock has delivered impressive returns in 2025, returning nearly 40% year-to-date.
4. General Dynamics Corporation (NYSE:GD)
Number of Hedge Fund Holders: 61
General Dynamics Corporation (NYSE:GD) is among the top 8 defense stocks based on ChatGPT’s advice. On October 28, BofA analyst Ronald Epstein lifted the price target for the stock to $400 from $370 and reaffirmed a Buy rating on its shares.
In a post-earnings note to investors, the analyst noted that while the Marine Systems segment fueled growth in Q3 for the defense contractor, he sees significant opportunities ahead for the company’s Combat Systems and Technologies segments, considering recent projects like the Golden Dome and surging international demand for weapons.
On the same day, JPMorgan also raised its price target for General Dynamics Corporation (NYSE:GD) to $380 from $345, while maintaining an Overweight rating on its shares. The firm cited the defense contractor’s strong financial results during the third quarter as the reason behind the adjustment. The analyst noted that GD’s balance sheet capacity was growing.
In Q3, General Dynamics Corporation’s (NYSE: GD) diluted earnings per share came in at $3.88, up 15.8% from the same period last year, and above analysts’ estimates of $3.70 per share. Revenue soared 10.6% year-over-year to $12.9 billion. While all segments saw a rise in earnings, Aerospace in particular performed impressively, with a 41% jump in operating earnings, amid strong order activity for business jets.
The company’s Marine segment was another star performer, with revenue rising 13.8% year-over-year and operating earnings growing 12.8% from the previous year.
Overall, Wall Street analysts maintain a positive outlook for the stock with a one-year share price target of $379.17, representing a 9% upside potential from the close on October 29.
General Dynamics Corporation (NYSE:GD) is a leading global aerospace and defense company, operating through its Aerospace, Marine Systems, Combat Systems, and Technologies segments.
3. RTX Corporation (NYSE:RTX)
Number of Hedge Fund Holders: 71
RTX Corporation (NYSE:RTX) is among the top 8 defense stocks based on ChatGPT’s advice. On October 27, BofA analyst Ronald Epstein hiked the price target on the stock to $215 from $175 and maintained a Buy rating on its shares.
The analyst noted growing momentum across the company’s Collins Aerospace, Pratt & Whitney, and Raytheon businesses, and argued that RTX Corporation (NYSE:RTX) was finally in a position to reap the rewards that were initially anticipated from the merger of Raytheon Company (RTN) and United Technologies Corporation (UTX) back in 2020.
BofA’s revision comes after the company declared Q3 FY25 results on October 21, reporting robust sales and profit growth across the three segments. RTX also raised its revenue and profit guidance for the full year, amid soaring demand for its missiles and aftermarket services, which strengthened its ability to face the adverse fallout from tariffs.
Following the earnings call, several firms adjusted their positions on the stock. These included UBS, Morgan Stanley, and Susquehanna, which substantially raised their price targets for RTX Corporation (NYSE:RTX), citing the strong financial results.
Overall, Wall Street analysts maintain a positive outlook for the stock, with a one-year average share price target of $192.06, representing an upside potential of 8.5% as of the close on October 29.
RTX Corporation (NYSE:RTX) is a giant in the global aerospace and defense industry, providing systems and services to commercial, military, and government clients. It operates through three main businesses: Collins Aerospace, Pratt & Whitney, and Raytheon.
2. Northrop Grumman Corporation (NYSE:NOC)
Number of Hedge Fund Holders: 42
Northrop Grumman Corporation (NYSE:NOC) is among the top 8 defense stocks based on ChatGPT’s advice. On October 22, UBS lifted its price target on the stock to $770 from $769, while maintaining a Buy rating on the company’s shares.
According to TheFly, the firm noted the defense contractor’s robust growth outlook for the years ahead, given its current portfolio. UBS believes Northrop currently has a conservative outlook for the outcomes of the reconciliation and repricing of the B-21 program, exposure to the Golden Dome project, and a potential contract for the F/A-XX program. These could have significant upside potential for the stock if the company were to secure contracts for these.
During a recent earnings call on October 21, Northrop Grumman Corporation (NYSE:NOC)’s CEO Kathy Warden said that the company is eyeing more new U.S. Air Force contracts for the B-21 program by the end of this year. The Congress, in July, passed the budget reconciliation bill, providing $4.5 billion to accelerate the production of the stealth bomber.
According to a report on Reuters on October 7, Northrop Grumman Corporation (NYSE:NOC) is also competing with Boeing to be chosen to produce the Navy’s next stealth fighter, the F/A-XX, with an announcement on the contract from the Pentagon expected soon.
In other related news, on October 23, Bernstein raised its price target for the stock to $696 from $674 and kept a Market Perform rating on its shares. The revision followed the company’s third-quarter earnings, in which it reported a strong beat with an EPS of $7.67 against estimates of $6.44.
Northrop Grumman Corporation (NYSE:NOC) is one of the largest defense contractors in the world. It is engaged in the design, development, integration, and maintenance of advanced systems across aeronautics, space, defense electronics, and mission solutions.
1. Lockheed Martin Corporation (NYSE:LMT)
Number of Hedge Fund Holders: 73
Lockheed Martin Corporation (NYSE:LMT) is among the top 8 defense stocks based on ChatGPT’s advice. On October 29, the company announced a strategic collaboration with Google Public Sector to integrate generative AI into the defense contractor’s AI factories.
According to the company’s press release, advanced AI tools from Google will be integrated across both its in-house and air-gapped systems. This will give employees and teams wider access to advanced, data-driven solutions. The company also emphasized that the integration will continue to meet key national security standards.
Lockheed Martin Corporation (NYSE:LMT) will leverage generative AI to manage workloads with improved efficiency and speed. It will also help the company develop safe and secure AI to advance what it calls 21st Century Security Solutions across multiple sectors, including aerospace, cybersecurity, and space.
The technologies will initially be deployed on the company’s unclassified on-premise infrastructure before further integration, providing workers access to the tech giant’s suite of AI tools, including Gemini models, on the Google Distributed Cloud.
Lockheed Martin Corporation (NYSE:LMT) is one of the largest defense contractors in the world. It is famed for manufacturing notable fighter jets, including the F-35. The company also delivers advanced autonomous solutions to the US military to support its most demanding missions.
While we acknowledge the potential of LMT 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 LMT and that has 100x upside potential, check out our report about the cheapest AI stock.
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