Sectors & IndustriesIndustrialsAerospace & Defense

Best Defense Stocks to Buy Now (2025)

Top defense stocks in 2025 ranked by overall Zen Rating. "A" Rated stocks have returned an average of +32.52% per year, and are the best defense stocks to buy now. Learn More.

According to Zen Ratings, our proprietary rating system that evaluates 115 factors proven to drive growth in stocks and assigns each stock in our system an overall letter grade as well as 7 individual Component Grades for Value, Growth, Momentum, Sentiment, Safety, Financials, and proprietary AI algorithms, the 3 best defense stocks to buy right now are:

Moog (NYSE:MOG.A) is the #1 top defense stock out of 77 with a Zen Rating of A. Stocks with a rating of A have had an average return of +32.52% per year. Learn more.

The Component Grade breakdown for Moog (NYSE:MOG.A) is: Value: C, Growth: B, Momentum: C, Sentiment: B, Safety: B, Financials: C, and AI: C.

Moog (NYSE:MOG.A) has a Due Diligence Score of 35, which is 5 points higher than the defense industry average of 30.

MOG.A passed 14 out of 38 due diligence checks and has average fundamentals. Moog has seen its stock return 5.11% over the past year, underperforming other defense stocks by -22 percentage points.

Moog has an average 1 year price target of $210.00, an upside of 6.3% from Moog's current stock price of $197.56.

Moog stock has a consensus Buy recommendation according to Wall Street analysts. Of the 2 analysts covering Moog, 50% have issued a Strong Buy rating, 0% have issued a Buy, 50% have issued a hold, while 0% have issued a Sell rating, and 0% have issued a Strong Sell.

Optex Systems Holdings (NASDAQ:OPXS) is the #2 top defense stock out of 77 with a Zen Rating of A. Stocks with a rating of A have had an average return of +32.52% per year. Learn more.

The Component Grade breakdown for Optex Systems Holdings (NASDAQ:OPXS) is: Value: B, Growth: C, Momentum: B, Sentiment: C, Safety: C, Financials: B, and AI: C.

Optex Systems Holdings (NASDAQ:OPXS) has a Due Diligence Score of 51, which is 21 points higher than the defense industry average of 30.

OPXS passed 16 out of 33 due diligence checks and has strong fundamentals. Optex Systems Holdings has seen its stock return 25.59% over the past year, underperforming other defense stocks by -2 percentage points.

Ducommun (NYSE:DCO) is the #3 top defense stock out of 77 with a Zen Rating of A. Stocks with a rating of A have had an average return of +32.52% per year. Learn more.

The Component Grade breakdown for Ducommun (NYSE:DCO) is: Value: C, Growth: B, Momentum: B, Sentiment: C, Safety: B, Financials: B, and AI: C.

Ducommun (NYSE:DCO) has a Due Diligence Score of 43, which is 13 points higher than the defense industry average of 30.

DCO passed 14 out of 33 due diligence checks and has strong fundamentals. Ducommun has seen its stock return 44.16% over the past year, overperforming other defense stocks by 17 percentage points.

Ducommun has an average 1 year price target of $119.75, an upside of 28.99% from Ducommun's current stock price of $92.84.

Ducommun stock has a consensus Strong Buy recommendation according to Wall Street analysts. Of the 4 analysts covering Ducommun, 75% have issued a Strong Buy rating, 25% have issued a Buy, 0% have issued a hold, while 0% have issued a Sell rating, and 0% have issued a Strong Sell.

Out of 20 defense stocks that have issued dividends in the past year, the 3 defense stocks with the highest dividend yields are:

Transdigm Group (NYSE:TDG) has an annual dividend yield of 5.32%, which is 4 percentage points higher than the defense industry average of 1.33%.

Transdigm Group's dividend payout ratio of 248.8% indicates that its high dividend yield might not be sustainable for the long-term.

Smith & Wesson Brands (NASDAQ:SWBI) has an annual dividend yield of 4.74%, which is 3 percentage points higher than the defense industry average of 1.33%. Smith & Wesson Brands's dividend payout is stable, having never dropped by more than 10% in the last 10 years. Smith & Wesson Brands's dividend has shown consistent growth over the last 10 years.

Smith & Wesson Brands's dividend payout ratio of 173.3% indicates that its high dividend yield might not be sustainable for the long-term.

Park Aerospace (NYSE:PKE) has an annual dividend yield of 1.99%, which is 1 percentage points higher than the defense industry average of 1.33%. Park Aerospace's dividend payout is not stable, having dropped more than 10% two times in the last 10 years. Park Aerospace's dividend has shown consistent growth over the last 10 years.

Park Aerospace's dividend payout ratio of 148.5% indicates that its dividend yield might not be sustainable for the long-term.

Defense stocks were up 0.76% in the last day, and up 0.82% over the last week. Boeing Co was the among the top gainers in the aerospace & defense industry, gaining 2.52% yesterday.

Boeing shares are trading higher after the company announced the X-37B Orbital Test Vehicle completed its eighth mission today by launching with the SpaceX Falcon 9.

Based on the Valuation rating, one of the 7 components of a stocks overall Zen Ratings grade, which evaluates factors including estimated earnings yield, earnings before interest and taxes/enterprise value, cash flow yield, free cash flow to price, and price-to-earnings growth (PEG ratio), the 3 most undervalued defense stocks right now are:

Textron (NYSE:TXT) is the most undervalued defense stock based on its Valuation Rating of A. Valuation is one of 7 Component Grades used to calculate the overall Zen Rating.

Textron has a valuation score of 57, which is 39 points higher than the defense industry average of 18. It passed 4 out of 7 valuation due diligence checks.

Textron's stock has dropped -8.16% in the past year. It has underperformed other stocks in the defense industry by -35 percentage points.

V2x (NYSE:VVX) is the second most undervalued defense stock based on its Valuation Rating of A. Valuation is one of 7 Component Grades used to calculate the overall Zen Rating.

V2x has a valuation score of 57, which is 39 points higher than the defense industry average of 18. It passed 4 out of 7 valuation due diligence checks.

V2x's stock has gained 6.63% in the past year. It has underperformed other stocks in the defense industry by -21 percentage points.

Optex Systems Holdings (NASDAQ:OPXS) is the third most undervalued defense stock based on its Valuation Rating of B. Valuation is one of 7 Component Grades used to calculate the overall Zen Rating.

Optex Systems Holdings has a valuation score of 43, which is 25 points higher than the defense industry average of 18. It passed 3 out of 7 valuation due diligence checks.

Optex Systems Holdings's stock has gained 25.59% in the past year. It has underperformed other stocks in the defense industry by -2 percentage points.

57.14% of defense stocks rated by analysts are a strong buy right now. On average, analysts expect defense stocks to rise by 9.4% over the next year.

4.35% of defense stocks have a Zen Rating of A (Strong Buy), 21.74% of defense stocks are rated B (Buy), 55.07% are rated C (Hold), 10.14% are rated D (Sell), and 8.7% are rated F (Strong Sell).