The company also provides life-cycle sustainment services to the U.S. Navy fleet and other maritime customers; high-end information technology and mission-based solutions for U.S. Department of Defense, intelligence and federal civilian customers; nuclear management and operations and environmental management services for the Department of Energy, Defense Department, state and local governments, and private sector companies; defense and federal solutions; and unmanned systems.
Huntington Ingalls stock comes with a 2.27% dividend. Barclays has a $270 target, and the consensus target is $260.40. The stock closed at $220.54 on Tuesday.
Lockheed Martin
This is another top aerospace and defense stock to buy, and it still offers investors looking to buy shares a solid entry point. Lockheed Martin Corp. (NYSE: LMT) researches, designs, develops, manufactures, integrates, operates and sustains advanced technology systems, products and services. It also provides a wide range of defense electronics products and IT services.
Being the Pentagon’s prime contractor, Lockheed Martin offers a diverse portfolio of global aerospace, defense, security and advanced technologies. Its leveraged presence in the Army, Air Force, Navy and IT programs guarantees a steady inflow of follow-on orders, not only from the U.S. government but also from many foreign allies of the nation.
Over the past several years, Lockheed Martin’s backlog has substantially outgrown the rest of the industry, supporting the growth outlook for the foreseeable future. The company has exposure to Defense Department priority buckets and consistently executes well. Even if the end market growth rate slows, continued strong fundamentals can be expected, with compounding earnings and cash flows.
The company posted solid results last week and raised guidance for 2023.
The dividend yield here is 2.61%. DZ Bank’s price objective of $523 is well above the $483.00 consensus target for Lockheed Martin stock. Tuesday’s close was at $463.26 a share.
L3 Harris Technologies
After its 2019 merger, this became the sixth-largest defense company. L3 Harris Technologies Inc. (NYSE: LHX) is an agile global aerospace and defense technology innovator engaged in the provision of defense and commercial technologies across air, land, sea, space and cyber domains.
Its Integrated Mission Systems segment includes intelligence, surveillance and reconnaissance; advanced electro optical and infrared; and maritime power and navigation. The Space and Airborne Systems segment comprises space payloads, sensors and full-mission solutions; classified intelligence and cyber defense; avionics; and electronic warfare.
Top Wall Street analysts have felt for some time that L3 Harris Technologies is situated well in the high growth buckets of the Defense Department budget, and many believe the business is not as short-cycle as the market historically has perceived. Merger synergies give the business a unique path to cash flow and margin upside, along with above-average revenue growth.
Shareholders receive a 2.11% dividend. The Truist Financial price target is $255. L3 Harris Technologies stock has traded as high as $279.71 in the past year but closed on most recently at $214.82.
Northrop Grumman
This was ranked as one of the top five defense contractors by sales last year, and it is on the BofA Securities US 1 list of top stock picks. Northrop Grumman Corp. (NYSE: NOC) provides innovative systems, products and solutions in unmanned systems, cyber, C4ISR and logistics and modernization to government and commercial customers worldwide.
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