The Trend

The Trump Effect: The “Behind the Scenes” Opportunities



In late May 2017, we highlighted Trump’s Midas touch.

Then, lo and behold it happened again days after.

We already mentioned the $350 billion deal with the Saudis, and noted that defense stocks exploded to all-time highs, as a result. 

  • Raytheon ran from $156 to $162.50. 
  • Boeing (BA) ran from $175 to $184. 
  • General Dynamics (GD) ran from $191 to $199. 
  • Northrop Grumman (NOC) ran from $243 to nearly $252. 
  • Lockheed Martin (LMT) ran from $267 to $278.

Days later, Trump asked for approval on a $668 billion defense budget for 2018 that would boost military spending.  It would increase the Defense Department’s budget to $574.6 billion, buy six ships, new fighter jets, 15 new KC-46 air tankers, which are used for aerial refueling and help grow the U.S. military by another 56,000 new service members. 

That’s one of the biggest defense budgets in the world.


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For comparison, in 2015, the U.S. spent $610 billion on the military.  That was $9 billion more than what China, Russia, Saudi Arabia, the UK and India spent combined. 

Therein lies the Midas touch yet again.

Unfortunately, many of the above-mentioned stocks have already moved on the excitement.  But there are companies flying well under radar still overlooked. 

Companies such as Aerojet Rocketdyne Holding (AJRD) for example make the propulsion systems for the military that are critical for ground-based missile defense systems, sea-based defense, strategic systems, and missile programs like the Standard Missile, Terminal High Altitude Defense (THAAD) and Ground-based Missile Defense (GMD), and Minuteman.

Even Orbital ATK (OA) develops and produces propulsion and controls for air-, sea- and land-based tactical missiles and missile defense interceptors. The company also produces fuzing and warheads for both tactical missiles and munitions; builds precision metal and composite structures for medium- and large-caliber ammunition, military aircraft, ground vehicles, and missile systems; and manufactures propellants and powders for the canister and commercial markets, according to its site.

What makes propulsion stocks even more attractive is news from the U.S. Army.

They just requested a total budget of $166 billion, part of which would be used for air and missile defense (which currently represent the Army’s most urgent needs).

The behemoth defense stocks may have moved already.  However, companies that play a big part behind the scenes could be about to move, too.  It’s just something to be aware of.