This article looks at the defense stocks that are declining this week.
European defense stocks have rallied this year as governments faced pressures to increase military spending. During the week of March 3, several stocks registered double-digit growth, with some even recording all-time highs. Investor sentiment picked up after the European Summit in London, where leaders from the EU and NATO met to express their support for Ukraine.
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The United States has repeatedly called for Europe to spend more on defense, stressing it could no longer foot the bill. EU leaders met in Brussels on Thursday to discuss the ‘ReArm Europe Plan’, which will allow the bloc to mobilize funds up to $860 million through bonds and relaxed rules on borrowing and spending.
Countries are also ramping up defense expenditure on an individual-level. A conservative victory in Germany is also adding to the momentum. Parties in talks to form the nation’s next government are already considering setting up a defense fund. Friedrich Merz, Germany’s next chancellor-in-waiting, has also vowed to relax the country’s strict borrowing rules.
In contrast, the defense sector in the US has been shaky since Trump’s return to the White House, amid mixed statements on military expenditure throughout his campaign and the early days of his second stint. The creation of DOGE is also reshaping investors’ views of the industry.
Defense stocks wobbled over the past week after a contentious meeting at the Oval Office between Trump and Ukrainian leader, Volodymyr Zelensky, as investors hoped for the US-Ukraine minerals deal to be signed. Shares also fell sharply in February after the US President suggested the country could rapidly cut military spending in the future.
Byron Callan, managing partner at Capital Alpha Partners, believes there is a high level of uncertainty in the U.S. defense sector related to current and future programs and the likelihood of severe cuts to government workforces.
According to a report in the Financial Times on February 24, shares of the six largest American defense companies have fallen 4% under 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 emerged as winners as they tapped into Europe’s defense expenditure surge. While the performance of the U.S. defense sector was lagging behind Europe and Asia well before the presidential elections, the gap has widened after Trump’s victory.
Let’s now head over to the list of defense stocks that are declining 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.
A security guard patrolling a defense facility, protecting critical technologies.
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 decline in share price during this period. All data is as of the close of business on Friday, March 7, 2025.
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10. The Boeing Company (NYSE:BA)
Weekly Decline: -11.71%
The Boeing Company (NYSE:BA) is a leading aerospace company that manufactures commercial airplanes, space systems, and defense equipment for customers in over 150 countries.
The company’s challenges have been aggravated this year by new tariffs imposed by the Trump administration. The Boeing Company (NYSE:BA) has slumped 11.71% over the past week after CEO Kelly Ortberg told employees the tariffs could drive up costs and cause disruptions in the supply chain.
Investor sentiment was further dented on Friday after a federal judge ruled that The Boeing Company (NYSE:BA) must face shareholder class action for the 737 MAX 9 blowout incident in January 2024. The judge also accused the company of prioritizing profit over passenger and aircraft safety.
9. AMMO, Inc. (NASDAQ:POWW)
Weekly Decline: -12.50%
AMMO, Inc. (NASDAQ:POWW) designs, produces and markets ammunition for law enforcement and military agencies, recreational shooters, hunters, and individuals requiring self-defense. It owns GunBroker.com, which is one of the world’s largest online marketplaces for firearms and shooting accessories.
On February 25, the company announced it had received an additional deficiency notification from NASDAQ for its failure to timely file its quarterly results for the period ended December 31, 2024. The notice stated that AMMO, Inc. (NASDAQ:POWW) was not in compliance with NASDAQ’s listing rules, and had until March 6 to submit an updated plan to regain compliance.
AMMO, Inc. (NASDAQ:POWW)’s share price has been sliding since receiving the notice. The stock slumped 12.50% during the past week, with a 4.11% dip on Friday.
8. National Presto Industries, Inc. (NYSE:NPK)
Weekly Decline: -12.58%
National Presto Industries, Inc. (NYSE:NPK) is an important player in America’s defense industry. It is a major supplier of 40mm ammunition and cartridge cases to the Department of Defense (DoD). The company started in 1905 by producing pressure canners for home use, before venturing into other cooking appliances and, later, defense and safety products.
On February 21, National Presto Industries, Inc. (NYSE:NPK) declared strong results for fiscal 2024, with consolidated sales growing 13.9% year-over-year, driven by a surge in defense sales. Net earnings also grew 20% from last year. The Housewares/Small Appliance segment also registered a 5.3% increase in sales, reflecting an improved retail environment.
National Presto Industries, Inc. (NYSE:NPK)’s share price slumped 12.58% over the past week after the company revealed that a cybersecurity incident occurred on March 1, which has disrupted several areas, including certain manufacturing processes, shipping and receiving, and back-office operations.
7. Byrna Technologies Inc. (NASDAQ:BYRN)
Weekly Decline: -12.63%
Byrna Technologies Inc. (NASDAQ:BYRN) manufactures less-lethal equipment and munitions for personal security, private security firms, military, and law enforcement agencies.
On March 5, the company declared preliminary results for the first quarter of fiscal 2025. Byrna Technologies Inc. (NASDAQ:BYRN) is expecting a revenue of $26.2 million, which will represent a 57% year-over-year growth, and is attributed to successful marketing strategies and increased production levels at the Fort Wayne factory.
While the announcement should have bolstered investor interest in the company, Byrna Technologies Inc. (NASDAQ:BYRN)’s share price continued to fall. The stock has plunged 12.63% over the past week, adding to the 9.75% decline during the week of February 24. Overvaluation concerns among investors, given its high P/E ratio, is a likely driver behind the dip.
6. Redwire Corporation (NYSE:RDW)
Weekly Decline: -13.67%
Redwire Corporation (NYSE:RDW) is a global space company, providing critical space infrastructure for government and commercial users. The company expanded into defense this year, with a $925 million acquisition of drone maker, Edge Autonomy, in January.
The stock is down 27% year-to-date, amid ongoing investigations around the fairness of the acquisition to shareholders. Law firms, Halper Sadeh LLC and Kahn Swick & Foti, LLC, are inquiring about the terms of the agreement.
Redwire Corporation (NYSE:RDW)’s share price slumped 13.67% over the past week in the run up to the scheduled announcement of Q4 2024 financial results during the week of March 10. Analysts expect the company to report a loss of $0.18 per share.
5. Planet Labs PBC (NYSE:PL)
Weekly Decline: -13.85%
Planet Labs PBC (NYSE:PL) provides global daily satellite imagery and geospatial solutions. It is among the defense stocks that are declining this week.
The company’s share price nearly doubled in 2024, but the momentum seems to be fading in 2025, with the stock dipping 34% over the past month, including a 13.85% slump last week. Analysts believe the surge in space stocks last year may have resulted in these companies appearing overvalued to investors, who are now selling their shares to lock in profits.
Another opinion behind Planet Labs PBC (NYSE:PL)’s stock declining is that while the company has made significant improvements in the fundamentals of the business and is inching toward profitability, its revenue is growing at a slow pace compared to projections made before its IPO.
4. Archer Aviation Inc. (NYSE:ACHR)
Weekly Decline: -15.32%
Archer Aviation Inc. (NYSE:ACHR) is an aerospace company, headquartered in San Jose, California, engaged in the development of eVTOL aircraft. On February 11, the company announced raising $300 million from leading institutional investors to accelerate the development of a hybrid aircraft platform for the defense market.
However, the stock has been on a slide over the past month, amid reports of DOGE looking to make cuts at the DoD. It is important to note that Archer Aviation Inc. (NYSE:ACHR) entered into a $148 million air taxi agreement with the US Air Force in 2023.
Archer Aviation Inc. (NYSE:ACHR) is among stocks that are declining this week, with a dip of over 15% during the period. Despite the slump, analysts remain bullish on the stock, with a consensus Strong Buy rating and an average share price upside potential of 54%.
3. Safe Pro Group Inc. (NASDAQ:SPAI)
Weekly Decline: -15.72%
Safe Pro Group Inc. (NASDAQ:SPAI) is a leading provider of security and protection solutions, with expertise in advanced AI/ML software technology for small object threat detection.
The company has seen volatile share price movement over the past two weeks, especially after the February 25 announcement of signing a multi-year agreement with a leading technical university in Ukraine, under which the two organizations will collaborate on utilizing Safe Pro Group Inc. (NASDAQ:SPAI)’s AI-powered drone image processing technology to develop training programs and build enhanced demining methodologies.
The stock was up 12% the following day at close. Since then, it has been on a steady decline, which is likely a sign of market correction. With a dip of 15.72% over the past week, Safe Pro Group Inc. (NASDAQ:SPAI) makes the list of defense stocks that are declining this week.
2. ParaZero Technologies Ltd. (NASDAQ:PRZO)
Weekly Decline: -17.40%
ParaZero Technologies Ltd. (NASDAQ:PRZO) is an Israel-based aerospace company that provides safety systems for defense Counter UAS systems and commercial unmanned aircraft.
The stock has plunged 66% year-to-date, with a share price decline of 29.05% during the week of February 24, and now another 17.40% slump over the past week. As a result, the company has made the list of declining defense stocks two weeks in a row.
ParaZero Technologies Ltd. (NASDAQ:PRZO) risks another non-compliance warning from NASDAQ with a potential delisting warning, as its minimum bid price has again fallen below the $1 mark.
Moreover, last month, ParaZero Technologies Ltd. (NASDAQ:PRZO) announced preliminary, unaudited results for fiscal 2024, which reflected a weakening liquidity position, with cash and cash equivalents declining by 43% from the previous fiscal year.
1. Momentus Inc. (NASDAQ:MNTS)
Weekly Decline: -24.53%
Momentus Inc. (NASDAQ:MNTS) is a commercial space company that offers satellite buses and in-space infrastructure services, including hosted payloads, in-space transportation, and other in-orbit services.
The company is also working on several space-related defense contracts, including a recent award by the DoD in February for the assembly of large structures in space. The mission is expected to launch in early 2026.
However, Momentus Inc. (NASDAQ:MNTS)’s shares have been on a continuous decline this year, having lost 75% of their value year-to-date. The company has been under pressure after receiving several delisting warnings over low share price and deficiency notices over the delayed filing of its Form 10-K.
Overall, Momentus Inc. (NASDAQ:MNTS) ranks first among the defense stocks that are declining 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 MNTS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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