Defense, drone and space stocks such as AST SpaceMobile, Rocket Lab, Planet Labs, Kratos and AeroVironment are set to receive non-cyclical, perpetual capex while many sit 60%-70% below their highs. Spending is rising in the US and across the rest of the world, flowing to names that are not crowded or recently up 1,000%. The sector has reset and been left for dead, making it a target basket for next year, including Ondas, LightPath, nLight, Karman and Inflection Point. x.com  x.com 

A US military-budget increase would be well-timed for defense stocks as most appear to be bottoming or sitting on support. If history repeats, one will probably be announced soon. Since the earlier sell signals, Amprius is down about 42%, AeroVironment about 60% and Ondas about 54%; many other names also look oversold. x.com 

Non-ITAR defense suppliers such as Electro Optic Systems, BAE Systems, Theon and Rheinmetall are an overlooked source of alpha as Europe, Asia and the Middle East shift defense spending away from US ITAR-controlled equipment. That shift comes with huge spending, yet US-based investors misunderstand it and wrongly call defense tech dead. Eurosatory confirmed the view, and the big alpha is not in drone builders. x.com  x.com  x.com 

Public defense stocks look mispriced because demand and private valuations are rising while their shares fall 20%. Anduril raised $5 billion at $61 billion, about 28x sales, while Ondas trades near 5x with a comparable counter-drone stack. The five primes' backlog rose 23.7% to $1.36 trillion, and the Pentagon's FY2027 request has $75 billion for drones and counter-drone tech. Peace rotates spending rather than ending it, and as in the 1990s, a bear market should spur small-cap consolidation. … Show more

Small-cap defense stocks such as Red Cat, AEVEX and Kraken Robotics look like buying opportunities after a sell-the-news drop following the Iran strikes, because the thesis has only gotten stronger. The U.S. lacks enough drones, interceptors, mine-hunting technology and critical metals, and a proposed $1.5 trillion defense budget should bring a wave of fresh contracts as it advances. The Iran war is a major catalyst even though Lockheed, Kratos and Red Cat have fallen 15-19% in a month. x.com 

Drone stocks fell in 2026 even as backlogs hit records: Ukraine turned aircraft into ammunition, and the Pentagon's 2027 request holds nearly $75B for drones and counter-drone. AeroVironment's reordered loitering munitions and Kratos's jet drones are highest conviction. Counter-drone names Ondas, Axon, Motorola Solutions, Safe Pro, DroneShield and Rheinmetall gain as threats grow, Unusual Machines from Chinese-parts bans. Primes bury drone exposure; pure plays may not convert backlog. x.com  … Show more

Government spending is defense's version of AI hyperscaler capex but more dependable, and the market isn't pricing it in. Global defense is seen at $3T+ for 2027 versus about $1T of hyperscaler capex, and the Pentagon seeks $80B in wartime spending on top of a $1.5T budget. With Lockheed Martin, Northrop Grumman, Kratos, AeroVironment, AEVEX and Kraken Robotics 24-58% off highs, capital could rotate back soon, especially if institutions diversify from AI, rewarding contrarians in 3-6 months. … Show more

Defense is the sector money is likely to rotate into heavily over the coming weeks and months, favoring nLIGHT and LightPath. Per @BlackScholesMan, the Iran war exposed serious shortfalls in Western defense that need to be plugged, and the money will follow. x.com 

Applied Aerospace & Defense offers exposure to growing defense, space and precision-strike spending through a business still very early in its public-market story. x.com 

Defense stocks make no sense in a bear market when wars are being paused because of weapons shortages. Per the NYT, as relayed by @runews, Trump put Iran escalation on hold over concerns about weapons shortages, a sign of demand that should support Ondas, Electro Optic Systems and Kraken Robotics. x.com