Defense Stocks Gain on Rising Demand Amid War in Iran
By Kelly Cloonan
Shares of defense firms Northrop Grumman and RTX gained on strong demand for their capabilities, with both reporting record backlogs for the latest quarter.
Northrop's stock rose 7%, on pace for its largest percent increase in more than a year, before paring some of those gains. It was recently up 5.4% at $537.96. RTX, meanwhile, rose in earlier trading but was recently trading about flat at $189.66.
Both companies reported robust demand for their defense technology in the third quarter as the war in Iran drives up governments' defense budgets.
Northrop said it had a total of $16.4 billion in net awards in the quarter for a record backlog of $109.6 billion, while RTX said it had more than $81 billion in new commercial and defense awards in the period, resulting in a record backlog of $340 billion.
"Globally, we continue to witness unprecedented levels of demand for defense capabilities," Northrop's Chief Executive Kathy Warden said during a call with analysts, adding that allied defense budgets are in the midst of a multi-year upswing.
The companies have been rushing to increase production of missiles in response to U.S. demand.
Lockheed Martin, another key defense contractor, is set to report quarterly results on Thursday.
Write to Kelly Cloonan at kelly.cloonan@wsj.com
(END) Dow Jones Newswires
October 20, 2026 11:39 ET (15:39 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.The articles, information, and content displayed on this webpage may include materials prepared and provided by third parties. Such third-party content is offered for informational purposes only and is not endorsed, reviewed, or verified by Morningstar.
Morningstar makes no representations or warranties regarding the accuracy, completeness, timeliness, or reliability of any third-party content displayed on this site. The views and opinions expressed in third-party content are those of the respective authors and do not necessarily reflect the views of Morningstar, its affiliates, or employees.
Morningstar is not responsible for any errors, omissions, or delays in this content, nor for any actions taken in reliance thereon. Users are advised to exercise their own judgment and seek independent financial advice before making any decisions based on such content. The third-party providers of this content are not affiliated with Morningstar, and their inclusion on this site does not imply any form of partnership, agency, or endorsement.
Popular
4 Stocks to Buy for the Long-Term While They’re Still Undervalued
What’s Ahead for Stocks This Quarter—and Where to Invest
Are TIPS ETFs the Best Way to Fight Inflation?
10 Best Blue-Chip Stocks to Buy for the Long Term
United States