Investing in Defense: 2 Key Stocks to Monitor in October 2024

Two Key Defense Stocks for Growth and Stability in October 2024

Editorial Team (ET)June 16, 2025

The defense industry continues to be a focal point for investors, especially with global tensions and military spending maintaining steady growth. In October 2024, several defense stocks are drawing attention for their stability, innovation, and long-term growth potential. The stocks we will cover today offer solid fundamentals and stand out as key players in the defense market.

What Are Defense Stocks?

Defense stocks represent companies that supply military and national security equipment, services, and technologies. These companies develop and manufacture products such as aircraft, weapons, cybersecurity solutions, and vehicles. They often operate under long-term government contracts, ensuring a predictable stream of revenue. Defense stocks are considered a safe haven for investors seeking stability amidst global uncertainties.

Why Invest in Defense Stocks?

Investing in defense stocks offers several advantages:

Stable Government Contracts: Defense companies often sign multi-year contracts with government agencies, providing them with steady revenue streams.
Consistent Demand: Regardless of economic downturns, military spending tends to remain consistent.
Dividend Yields: Many defense stocks offer dividends, making them appealing to income-seeking investors.

However, investors should also be mindful of the risks, including:

Political Changes: Defense spending can fluctuate depending on the administration in power.
Ethical Concerns: Some investors avoid defense stocks due to ethical concerns about profiting from warfare.

###What to Consider When Evaluating Defense Stocks? ###

When choosing defense stocks, it's crucial to look beyond just financial performance. Key factors include:

Contract Backlog: A large backlog of government contracts indicates future revenue.
Innovation: Companies that invest in cutting-edge technologies, such as autonomous systems and cyber defense, are likely to stay ahead in the industry.
Global Political Climate: Events such as international conflicts, arms control agreements, and defense budgets affect defense companies' performance.

Now, let’s dive into two defense stocks that should be on your radar this October.

Northrop Grumman Corporation (NYSE: NOC)

Northrop Grumman Corporation (NOC) is a global leader in aerospace and defense technology. The company specializes in the design, development, and manufacture of advanced aircraft, missile defense systems, space exploration solutions, and cybersecurity technologies. As a key player in the defense sector, Northrop Grumman’s ability to innovate in areas such as autonomous systems and next-generation aircraft places it at the forefront of military advancements.

In October 2024, Northrop Grumman is expected to release its third-quarter financial results on October 24. Investors are watching closely, as the company’s financial performance has been strong throughout the year. The company will also host a conference call on the same day to discuss its earnings and future outlook.

Year-to-date, NOC stock has seen an impressive 13.82% increase. As of the last trading session, shares of Northrop Grumman were trading at $535.06, representing a slight dip of 0.26%. This minor fluctuation reflects broader market conditions rather than any company-specific challenges.

Why Northrop Grumman?

Cutting-Edge Technology: Northrop Grumman’s involvement in projects such as next-generation autonomous aircraft and space exploration ensures it remains competitive.
Government Contracts: The company benefits from long-term contracts with U.S. government agencies, particularly in missile defense and aerospace.
Strong Financials: Northrop Grumman’s consistent revenue growth, bolstered by government spending, makes it a safe bet for investors looking for stability in the defense sector.

General Dynamics Corporation (NYSE: GD)

General Dynamics Corporation (GD) is another major player in the defense industry. The company operates across four main business segments: aerospace, marine systems, combat systems, and technologies. General Dynamics is well-known for its Gulfstream business jets, but its defense contributions include everything from submarines to land combat vehicles.

One of the most significant updates for General Dynamics in 2024 is a substantial contract awarded to its subsidiary, NASSCO. In September, NASSCO received a contract from the U.S. Navy for the construction of up to eight additional John Lewis-class fleet replenishment oilers. The initial contract, valued at $780 million, is part of a larger agreement that could exceed $6.7 billion if all eight ships are built.

This contract solidifies General Dynamics’ long-standing relationship with the U.S. Navy and positions the company as a critical contributor to the U.S. military’s fleet renewal program.

Year-to-date, GD stock has increased by 15.73%. As of the most recent trading session, shares of General Dynamics were trading at $299.27, reflecting a slight drop of 0.46%. Despite this, General Dynamics remains one of the top defense stocks to watch in October.

Why General Dynamics?

Diverse Product Line: General Dynamics’ wide range of products—from Gulfstream jets to submarines—makes it a versatile player in the defense industry.
Strong Naval Contracts: The recent U.S. Navy contract for replenishment oilers highlights the company’s strategic importance in marine defense.
Financial Stability: Like Northrop Grumman, General Dynamics benefits from long-term government contracts that provide predictable revenue streams.

Conclusion

As global tensions and defense budgets continue to rise, defense stocks remain an attractive investment option. Both Northrop Grumman Corporation and General Dynamics Corporation are well-positioned to benefit from increased government spending and long-term defense contracts. With solid financial performance and strong relationships with government agencies, these two companies offer stability and growth potential in an uncertain market.

Investors should continue to monitor the defense sector, as geopolitical events and technological advancements will play a significant role in shaping its future. For those looking to diversify their portfolios, adding defense stocks like Northrop Grumman and General Dynamics could provide both stability and growth in the years to come.

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