Raytheon (RTX)

A US defence stock? He doesn't own anything in defence, but within the sector, this is a stock that has done very, very well for several years, and a key one to own because of the antimissile defence capabilities.

(A Top Pick Jun 13/17, Up 16%) They are focused more internationally, which is one driver. They are missile defense and cyber security. Both are good.

Higher defense spending is benefiting them. There is also great call for their cyber security. It is fully valued but he is sticking with it at this time. (Analysts’ target: $204.00).

A very solid US defence company. Probably one of the stronger subsectors within defence. They are one of the leaders in the missile defence systems. If he had owned this for the last year, he would probably take half his position off.

(A Top Pick June 13/17. Up 16%.) Had strong bookings this past quarter, and everything looks just fine. The 2 areas he really likes are missile and cyber, and this company is involved in both. With the US trying to encourage the rest of the world to catch up on defence spending, the space has been well bid, and this one is only a 6% premium to the group.

Has a terrific free cash flow yield. It is a defence contractor. If you own, you’ve done really well. As long as international governments are not relying on the US to defend them, it seems there is going to be a lot of defence buying by countries such as Japan.

A defence stock which has done very well. 30% to 40% would be a pretty good description of the appreciation of this whole basket of defence stocks. Personally, he would shy away. There is a bit of a bid under the stocks because of what is happening in North Korea and that Pres. Trump is very much a hawk and wants to bolster defence spending. But you have to be very, very careful about valuation, and not buy at the end of a trend.

For a long-term hold? Defence is a sector that she wants to gain some exposure in. However, defence is a little ahead of itself. Trading at very high multiples. They’ve all had really good runs.

Trump’s speech last night may have drawn our attention to defense stocks. This company makes all kind of interesting electronic products. The stock is a little ahead of itself at this point and so he would not buy it now. A number of his clients told him not to buy this for ethical reasons – no weapons manufacturers!

Defence. Over the last couple of months he has taken his broader-based industrial exposure and honed it down into aerospace and defence. This is a name he would highlight as a top pick in that. He likes this primarily because it is missiles, self defence and cyber, not exposed to any one particular government contract. (Analysts’ price target is $187.)

Expensive, but overall a good name. It is certainly one you could own. If there was a 10% pullback, he would be very interested in buying this.

US defence stocks have done very well over the last 2-3 years. Outlook under Trump is probably a little better, but that’s been priced into the stocks. This has a leadership in missiles and antimissile missiles. With North Korea making a lot of noise, they are going to get Congress approval to sell their missile defence systems into Japan, Korea and probably into Taiwan as well as other places. The big bogeyman is the F35 which is plagued with cost overruns. This is not a bargain, but will probably gradually appreciate over time.

A defence stock which supplies a lot of missiles. They have the missile missile/defence cyber. Another thing he likes is that they are a subcontractor in a number of different industry segments, but not a dominant provider for any one project for the US government. Dividend yield of 1.9%. (Analysts’ price target is $173.)

A US defence stock that is likely to perform well in the next year? Defence stocks have started to perform well. Pres. Trump’s promise to rebuild the military and taking on ISIS is certainly good for the sector. She doesn’t really invest in the stocks that will harm people, but what she has read indicates General Dynamics (GD-N) and Raytheon (RTN-N) would be a good way to play it.

It is part of the industrial sector that has had a good run and should do well under a Trump administration. You should buy it on any modest correction. He is very bullish on this industry.