I wanted to give you a little update on my current defense portfolio and the planned changes.
📍Status Quo:
📍Capability areas and benefits for the portfolio:
Air & missile defense
$RTX (+0.23%) ,$LMT (+0.39%)
Patriot, PAC-3, THAAD - core systems for the protection of cities, bases and fleets
Combat aircraft & air dominance
$LMT (+0.39%) , $BA. (-1.31%)
F-35 program (LMT), Eurofighter Typhoon, future Tempest/FCAS
Maritime strike capability
$HII (+0.07%) , $GD (-0.18%) , $BA. (-1.31%)
Nuclear submarines (Virginia, Astute), Type-26 frigates, combat systems
Sensors & electronic reconnaissance
$HAG (-0.77%) , $QQ. (-0.65%) , $CHRT (-4.67%) , $BA. (-1.31%)
AESA radars, ESM/ECM, BAE Raven ES-05 radar
Autonomous systems & drones
Almost all companies play me here. $KTOS (+0.22%) as the only drone pure play.
Unmanned jets (XQ-58) and tactical UAS - rapidly growing budget item
Cyber / AI & data fusion
$PLTR (-0.13%) ,$CACI (-0.05%)
AI-supported command and control systems (PLTR Gotham/Apollo) and US government IT services
Ground-based large-scale systems
$GD (-0.18%) ,$NOC (+0.04%) , $BA. (-1.31%)
Abrams modernizations, artillery rockets and ground-based sensors, CV90-IFV, M109 howitzers
Multidomain space flight
$NOC (+0.04%)
US nuclear deterrence - from delivery systems to warning and command and control networks
💰Realized partial sales at $HAG and $PLTR
I had already reduced $HAG and $PLTR by 50% each this year with large gains (+651% and +346%):
The valuations of both companies are currently extremely sporty.
PLTR
Trailing P/E ratio (TTM): 580 - 590x
Forward P/E ratio: ~240x
Price-to-sales: >100x
HAG
Trailing P/E ratio (TTM): 120 - 130x
Forward P/E ratio: ~80x
Price-to-sales: >5x
I will nevertheless remain invested in both positions for the time being. Mainly because I currently see no significant change in the underlying investment story.
Position sizes are relativized by new planned purchases and the concentration risk falls from 34% → 25% of the sleeve.
📊Planned adjustments:
❓Why these changes?
New position$AVAV (+0.3%)
(drones/loitering ammunition):
Covers the fastest growing budget line (attritable UAS), which was previously barely represented.
New position $RHM (-0.77%)
(Ammunition & Platforms)
Adds the "155 mm grenades" bottleneck and European land systems to the portfolio; beneficiary of EU armament.
Increase $RTX (+0.23%)
Most favorable US prime (forward P/E ≈ 25), high visibility in air/missile defense systems.
Top-up $GD (-0.18%)
Diversified towards submarines, ground vehicles and ammunition; reliable free cash flow.
📉Planned, staggered entries:
$AVAV: $220 - $185
$RHM: €1550 - €1450
$RTX: $125 - $120
$GD: $285 - $270
🤔 What does your portfolio look like?
Which defense stocks do you hold and why?
