These Stocks Are Poised for a Record-Breaking Rebound

Last week, we learned that Defense Secretary Pete Hegseth’s stock broker rushed to buy stock in defense contractors just before the United States went to war with Iran.

Well, if he did, he didn’t exactly make out like a bandit.

The fund in question — the iShares Defense Industrials Active ETF (IDEF) — tumbled a little more than 14% in the month of March.

That decline mirrored a broader drop in defense stocks.

The iShares Aerospace and Defense ETF (ITA) slumped 16%, and the Global X Defense Tech ETF (SHLD) fell 12%.

All the heavyweights, from Lockheed Martin (NYSE: LMT) to RTX (NYSE: RTX) to General Dynamics (NYSE: GD), slumped as well. And smaller, tech-centered suppliers cratered even harder.

That’s not exactly the response one would expect from the breakout of a major global conflict.

Especially when defense budgets around the world have been soaring to never-before-seen levels.

So what gives?

Truly?

Nothing.

A market decline like this is unforgiving.

The war with Iran has introduced so much uncertainty and so many negative consequences that the market is selling off in bulk.

Losses are being cut, profits are being taken, options are being covered, and cash is being raised.

And in many cases investors are unloading their best-performing assets.

That includes tech stocks, AI plays, commodities, precious metals…

And, you guessed it, defense contractors.

Those funds I mentioned up top?

SHLD jumped 52% last year, while ITA was up 78%.

Individual defense contractors like Lockheed Martin were up too, including a 33% gain for GD and 62% gain for RTX.

L3Harris (NYSE: LHX) jumped 45%. And Kratos Defense and Security Solutions (NASDAQ: KTOS) flew almost 200% higher.

Gains like that could be found all through the defense sector.

And now that the market is pressed, they’re winding back down.

But here’s the thing…

They’re going to come back up.

In the immediate term, wars are running hot all over the planet. And longer-term defense budgets are expanding exponentially as countries respond to a new era of conflict.

President Trump just put in a massive defense funding request for the next fiscal year.

Europe is rethinking its entire defensive posture as Russia invades and America withdraws.

And smaller, traditionally agreeable Asian countries are bracing as China’s aggression mounts.

So if you’re holding on to defense contractors, stay the course. They’ll come back in.

And if you haven’t bought any recently, now is the time to go bargain shopping.

I’d recommend starting here with a little-known defense tech supplier that’s set to play an outsized role in President Trump’s signature defense initiative — the Golden Dome.

But really, in this market, you can’t go wrong with defense right now.