Pentagon Chaos Disrupts Surge in Defense Stocks

Defense stocks have rocketed to multi-year highs in 2017 on expectations of increasing revenue from a growing Pentagon budget. Nine months into the year, and most companies are still waiting.

An aerial view of the Pentagon. Source: Getty Images.

After weathering years of budget battles between Republicans in Congress and the Obama White House that culminated with sequestration -- and a freeze in defense spending -- in 2013, the defense industry was expecting a bounce back following the GOP sweep of the White House and Congress last November. Stocks reacted accordingly, with shares of defense titans Lockheed Martin (NYSE: LMT), General Dynamics (NYSE: GD), Northrop Grumman (NYSE: NOC), and Raytheon (NYSE: RTN) all up between 18% and 31% year to date, and Boeing, with its mix of defense and commercial aerospace, climbing more than 60%.

Source: Fool.com