This article looks at Goldman Sachs Defense Stocks: Top 12 Stock Picks. We also discuss the firm’s recent recommendations and projections concerning the sector this year.
After a subdued start to the year, American defense stocks are beginning to see improved returns. Investors are buoyed by President Trump’s plans for a $1 trillion defense budget for fiscal 2026, adding to the momentum from last month’s unveiling of the F-47 and announcement to resurrect the country’s shipbuilding industry.
READ ALSO: 10 Best Mid Cap Defense Stocks to Buy According to Analysts and 10 Best Performing Defense Stocks So Far in 2025.
The sector has received another boost after market chatter that tariff negotiations to address trade imbalances could include commitments from foreign countries to buy weapons from the US. In a statement released on April 8, Vietnam’s prime minister asked for a 45-day delay in the imposition of tariffs and stated his country would buy more American goods, including weapons, to tackle the trade gap.
On April 11, Goldman analyst Noah Poponak adjusted his ratings and price targets for defense stocks, and the most notable adjustment was a prominent Navy shipbuilder receiving a double upgrade on the back of an executive order signed by Trump to revitalize the sector. Poponak expects the stock to benefit, with shipbuilding expected to be a high priority within the defense budget.
The firm is known for its expertise in stock recommendations, helping investors identify high-potential companies. GS boasts a vast network of analysts, covers a wide range of stocks. It also has a research team led by analysts and economists from around the world, offering insights on the economy and the broader market.
In a report released in March this year, Goldman Sachs Research projected a significant increase in defense spending by EU member nations. Military expenditure in the euro area accounted for 1.8% of the GDP in 2024, and is projected to rise to 2.4% by 2027. The firm’s analysts estimate the increased spending to positively impact GDP growth, with every €100 spent on defense to boost GDP by approximately €50.
Defense stocks have rallied in Europe this year, as regional capitals unlocked billions to supercharge their militaries. While recent tariffs have sparked a major plunge in shares over the past couple of weeks, this has been a year to remember for several European defense contractors, with significant returns so far in 2025.
With that said, let’s head over to the list of the top defense picks from the Goldman Sachs stock portfolio.
A fighter jet in formation, revealing the prowess of the companies defense arm.
Methodology
For this article, we scanned Goldman Sachs’ 13F portfolio as of December 31, 2024. From there, we picked the top 12 defense stocks according to their stake value and ranked them in ascending order.
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12. Textron Inc. (NYSE:TXT)
Stake Value as of Q4 2024: $85,886,997
Textron Inc. (NYSE:TXT) manufactures products for consumers across several industries, through its six business segments: Bell, Textron Aviation, Textron eAviation, Textron Systems, Industrial, and Finance. It is one of the top defense picks from the Goldman Sachs stock portfolio.
On April 8, Textron Inc. (NYSE:TXT) announced that Textron Systems was awarded a three-year, $100 million contract from the Naval Sea Systems Command (NAVSEA) to perform payload integration and software support activity for the Mine Countermeasures (MCM) Unmanned Surface Vehicle (USV). Under the agreement, the company will also be responsible for testing and demonstration work on potential future mission systems.
Textron Inc. (NYSE:TXT) is an important player in America’s defense industry. In November last year, the DoD awarded Textron Aviation a $277 million contract to produce 26 T-54A trainer aircraft for the Navy, Marine Corps, and Coast Guard, with an estimated completion date of September 2026.
The company is also working on the FTUAS Option 3 and Option 4 award for the US Army. Under the contract, awarded in May 2024, Textron Systems will complete flight and MOSA demonstrations and deliver an Aerosonde Mk. 4.8 Hybrid Quad uncrewed aircraft system to the Army for testing and evaluation.
However, Textron Inc. (NYSE:TXT)’s share price has declined 19% over the past three months, after a significant year-over-year dip in revenue for the fourth quarter of fiscal 2024. The top-line figure also missed Street estimates. The company is expected to report Q1 FY25 results on April 24.
11. Moog Inc. (NYSE:MOG-A)
Stake Value as of Q4 2024: $108,442,341
Moog Inc. (NYSE:MOG-A) designs, manufactures, and integrates precision control components and systems for OEMs and end users in the aerospace, industrial, and defense markets.
On March 25, the company announced the shipment of Meteor satellite buses for national security space missions. This is a significant milestone for Moog Inc. (NYSE:MOG-A), which has expanded its footprint to the DoD’s programs. It also continues the company’s seven-decade-long commitment to protect warfighters and support those who explore the universe.
The Meteor is an ESPA Grande-class bus, featuring radiation-hardened space avionics, modular payload power, and mission-configurable flight software, making it ideal for dynamic space operations. This new bus builds on Moog Inc. (NYSE:MOG-A)’s earlier success of the Meteorite small satellite buses, which are currently supporting a national security mission on orbit.
In January, Moog Inc. (NYSE:MOG-A) was selected by Lockheed Martin to provide custom actuators for the PAC-3 MSE contract with the Army. The contract was valued at $100 million, making it one of the largest and most significant awards in the company’s defense division. The program is aimed at defending the country from inbound ballistic and cruise missiles, aircraft, and other advanced threats.
Moog Inc. (NYSE:MOG-A) is among the top defense picks from the Goldman Sachs stock portfolio, with the investment banking firm having a stake value of over $108 million in the company as of Q4 2024.