7 Stocks That Deliver Bulletproof Investment Income

Jason Simpkins

Posted June 18, 2024

Back in the spring, President Biden unveiled his latest defense spending proposal. 

It came in at a whopping $895 billion

However, if the U.S. Senate has its way, it’ll be even bigger than that. 

You see, the White House budget proposal is just that — a proposal. 

Congress has the purse strings in this country, and rather than play hardball on defense spending (as they do with so many other issues) our representatives typically grant more money than what the president asks for. 

This time around, the Senate has come back with a FY2025 defense budget totaling $923 billion.

The extra spending would include a bevy of add-ons, including funding for a second Virginia-class attack submarine that even the Navy says it doesn’t want.

Spearheading this spending spree is Mississippi Senator Roger Wicker, the top Republican on the Senate Armed Services Committee.

If Wicker had his way, the increase would have been even larger — $55 billion, as opposed to $28 billion as he considers it “a generational investment to prevent another world war.”

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“My amendment to increase the budget top line is a down payment, and it keeps advancing the discussion,” said Wicker. “Negotiations need a starting point, and this is not the end. I will not give up on reaching a defense level that meets the moment.”

Indeed, it’s unlikely that Wicker will get the increase he wants, but he’s done his part to pull the top line higher. And while bipartisanship is a dirty word these days, the defense budget routinely sails through Congress with little resistance.

Savvy investors know that — and act accordingly. 

Indeed, there’s no shortage of income-yielding defense stocks, including:

  • Lockheed Martin (NYSE: LMT) 2.75%
  • Northrop Grumman (NYSE: NOC) 1.94%
  • General Dynamics (NYSE: GD) 1.95%
  • RTX Corp. (NYSE: RTX) 2.42%
  • L3Harris (NYSE: LHX) 2.13%
  • Huntington Ingalls (NYSE: HII) 2.18%

In addition to the dividend yields, these stocks are also doling out some heavy capital gains in both the short and long term.

General Dynamics, for example, is up 34% in the past year and 70% in the past five years. That’s not uncommon for the industry, which is broadly benefiting from soaring defense spending worldwide.

However, if it’s the income you’re most interested in, there are a few defense-related investments that yield twice as much as these defense stocks. 

A good example of that is a REIT I recently recommended to Wealth Advisory subscribers. 

It currently yields 4.87% and it’s an even safer bet than the aforementioned defense contractors. 

In fact, it’s their landlord, leasing out office space, labs, testing ranges, training facilities, etc.

About a third of all its business comes from the General Services Administration (GSA) the government agency responsible for managing and supporting our sprawling bureaucracy. That includes facilities like courthouses and military bases.

So as the defense-industrial complex expands, so too does this company’s portfolio of income-generating properties. And since it’s a real estate investment trust (REIT), it’s required by law to distribute 90% of its income directly to its investors. 

Basically, it’s the perfect way to game the defense-industrial complex and reclaim your tax dollars.

In fact, it’s such a slam dunk that my co-editor Jason Williams and I put together a whole presentation on it.

Check that out here if you haven’t seen it yet.

Fight on,

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Jason Simpkins

Simpkins is the founder and editor of Secret Stock Files, an investment service that focuses on companies with assets — tangible resources and products that can hold and appreciate in value. He covers mining companies, energy companies, defense contractors, dividend payers, commodities, staples, legacies and more…

In 2023 he joined The Wealth Advisory team as a defense market analyst where he reviews and recommends new military and government opportunities that come across his radar, especially those that spin-off healthy, growing income streams. For more on Jason, check out his editor’s page.

Be sure to visit our Angel Investment Research channel on YouTube and tune into Jason’s podcasts.

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