Investors are in for a big week with many companies reporting quarterly earnings. Among the biggest sectors that could see stocks volatile with earnings this week is the defense sector. Here’s a look at some of the sector’s largest companies reporting and why the timing is important.
Defense Stocks on Watch
Defense stocks have had a 2026 to remember with some of the biggest names hitting all-time highs on the heels of increased tension in the Middle East and higher proposed military spending for the United States.
This week will see the following five large defense companies report:
Together, these five stocks are among the 10 largest holdings in the iShares US Aerospace & Defense ETF (BATS:ITA), making up a combined 53% of assets under management. Here are the current ETF weightings:
- GE: top holding, 19.22%
- RTX: second-largest holding, 15.88%
- BA: third-largest holding, 9.43%
- LMT: eighth-largest holding, 4.23%
- NOC: ninth-largest holding, 4.20%
Market Expert Says Guidance The Key
The earnings reports from defense stocks comes as the Middle East tension continues and the U.S. is trying to boost its defense budget, two items that could be among the keys in earnings reports, guidance and management commentary.
“Defense stocks have been one of the market’s best stories over the last year,” Freedom Capital Markets Chief Market Strategist Jay Woods said in a weekly newsletter. “There has been strong demand, locked-in contracts, and clearly some political tailwinds.”
Woods said the bar is high to continue at the current pace.
“Watch the guidance, especially when tied to Pentagon budgets. Any government slowdown could impact that projection. Also keep an eye on execution and backlog conversion.”
The market expert said the iShares US Aerospace & Defense ETF failed to hold the 50-day moving average recently, which could signal the defense trade losing momentum.
“The defense stocks may surprise to the downside given all the hype we have seen thanks to the war. The risk seems to favor the bears. The sector companies may need a fantastic guide and assurance from the Pentagon that spending on the war will continue to get back to those 52-week highs.”
Earnings History
Recent earnings history shows some strong trends of beating analyst estimates for several of the defense companies reporting this week, while others have struggled in recent quarters.
Here are the recent trends against analyst estimates, with data from Benzinga Pro:
The earnings trends show RTX and GE come into the latest report with long streaks of beating analysts. The other three defense stocks have more mixed results.
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