Look, I get it. When someone starts talking about defense stocks, your eyes probably glaze over faster than a donut at a police convention. But hear me out – this might actually be interesting, and potentially profitable.
Scott Helfstein, who manages money at Global X ETFs (they’ve got $60 billion under management, so they’re not exactly running a lemonade stand), thinks defense stocks are about to have a moment. And by “moment,” I mean potentially making you some serious cash in 2026.
Here’s the deal: The world is getting weird. Like, really weird. Between geopolitical tensions that make a family Thanksgiving dinner look peaceful and governments throwing money at defense budgets like they’re trying to win a spending contest, defense companies are sitting pretty.
Helfstein’s got five picks that he thinks are going to absolutely crush it:
Huntington Ingalls Industries (HII) – These guys build ships for the Navy, and they’re up 85% this year. Helfstein thinks we’re about to see autonomous ships become the new drones. Basically, robot boats are the future, and these folks are building them.
BAE Systems (BAESY) – This UK-based company is like the Swiss Army knife of defense contractors. They’re up 64% this year and trading at 19 times forward earnings with a 4% free cash flow yield. Translation: They make money and aren’t ridiculously overpriced.
Rheinmetall (RNMBY) – German engineering meets military hardware. They’re up a whopping 190% this year. As Europe gets more independent from US military support, these guys are positioned to benefit big time.
Lockheed Martin (LMT) – The old reliable of defense stocks. Sure, they’re down 1% this year (basically flat), but Helfstein sees this as a buying opportunity. When the US defense budget keeps growing, Lockheed tends to do well. It’s like betting on death and taxes – pretty reliable.
BWX Technologies (BWXT) – Up 57% this year, these guys are in both defense and civilian nuclear. With nuclear energy making a comeback (thanks, AI data centers!), they’re playing both sides of the nuclear coin.
Now, before you go throwing your life savings at defense stocks, remember that investing in companies that make things that go boom comes with its own risks. Geopolitical situations can change faster than a TikTok trend, and defense spending can be as unpredictable as your ex’s text messages.
But if Helfstein is right about this “decentralized deterrence” world we’re heading into (fancy talk for “everyone’s buying their own weapons now”), these companies could be sitting on a goldmine.
The bottom line? Defense stocks might not be the sexiest investment topic, but they could be one of the most profitable plays for 2026. Just don’t tell your friends at the peace rally.