We recently published a list of Why These Defense Stocks Are Gaining This Week. In this article, we are going to take a look at where Elbit Systems Ltd. (NASDAQ:ESLT) stands against other defense stocks that are gaining this week.
America’s defense sector has been shaky since Trump’s return to the White House, amid mixed statements on military expenditure in the early days of his second stint. Shares fell sharply last month after he hinted at cutting defense spending in the future. They wobbled again following his recent contentious spat with Zelensky at the Oval Office.
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According to a report in the Financial Times on February 24, shares of the six largest American defense companies have fallen 4% since the start of Trump’s second term. Whereas, Europe’s top defense groups have returned gains of around 40% during the same period. Several Korean companies have also benefited from Europe’s defense splurge.
European defense stocks have rallied this year as governments faced pressures to increase military spending. The momentum has further picked up after the conservative victory in Germany, and the European Summit in London, where leaders from the EU and NATO met to express their support for Ukraine.
While US defense stocks have missed the global rally, Citi analyst, Jason Gursky, is urging investors that this is the right time to buy them. Here is what he wrote in a note to clients on Wednesday:
“We recognize the world order is evolving under the current President, perhaps to a multi-polar one in which three countries control spheres of influence over the Americas, Europe and Asia. However, we don’t view that world to be any less dangerous or one that decreases the need to acquire the tools of deterrence.”
Trump’s recent statement on resurrecting American military and commercial shipbuilding has been well-received. Shares of a major naval defense contractor have surged over the past week, following the announcement. The US president has vowed to fix the industry, which he sees as vital to national security, given the strategic competition with China.
Let’s now head over to the list of defense stocks that are gaining this week. Please note that the stocks listed are based on one week’s performance. Our analysis does not reflect the prospects of the company. Their share price could go high or low in the future, depending on the external market conditions, industry-specific challenges, and the company’s capabilities. Additional research and caution are advised before making investment decisions.
Methodology
For this article, we went through screeners to see how stocks in the aerospace and defense industry performed over the past week (March 3-7). From there, we picked the top 10 stocks with the highest percentage gains in share price during this period. All data is as of the close of business on Friday, March 7, 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Elbit Systems Ltd. (NASDAQ:ESLT)
Weekly Gains: 14.80%
Elbit Systems Ltd. (NASDAQ:ESLT) is an Israel-based defense technology company. It is among the defense stocks that are gaining this week.
The company’s share price is up 38% year-to-date, with gains of nearly 15% over the past week. As of the close of business on March 7, the stock was valued at a record-high of $357.03 per share. Elbit Systems Ltd. (NASDAQ:ESLT) has been awarded several high-value contracts in recent months, which has raised investor interest in its upcoming Q4 2024 earnings call scheduled for March 18.
In November 2024, Elbit Systems Ltd. (NASDAQ:ESLT) was awarded contracts worth $335 million to supply defense systems, including rocket launchers and unmanned aircraft, to a European country. The company also received a $60 million contract in January this year to provide Counter Unmanned Aerial Systems to a NATO member state. According to reports, ESLT was recently picked by the Moroccan military as well for the purchase of self-propelled artillery.
Overall, ESLT ranks 2nd on our list of defense stocks that are gaining this week. While we acknowledge the potential of defense companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ESLT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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