Defense Stocks Draw Hedge Funds and Bullish Analysts
Rendy Andriyanto
Gotrade Team
Reviewed by Gotrade Internal Analyst
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Gotrade News - US aerospace and defense stocks are back in focus as hedge funds build sizable positions. Bullish sentiment strengthened as analysts upgraded RTX, Boeing, and General Dynamics within the past week.
Geopolitical conflicts are lifting global defense spending and boosting demand for major US prime contractors. As a result, sector valuations climbed and drew renewed interest from institutional and retail investors.
Key Takeaways
General Dynamics was held by 62 hedge funds in Q1 2026 with a backlog reaching $130.8 billion.
Jefferies upgraded RTX to Buy with a $220 price target on June 4, 2026.
Boeing benefits from China committing to 200 jets that could rise to 750 aircraft.
Hedge Funds Build Positions in General Dynamics
According to Insider Monkey, General Dynamics was held by 62 hedge funds in Q1 2026. The stock also carries a Moderate Buy rating from 15 analysts, with roughly 12% average upside.
The company's operating performance reinforces that view. Q1 orders reached $26.6 billion with a $130.8 billion backlog, while segment sales rose on geopolitical conflicts.
The $130.8 billion backlog offers multi-year revenue visibility that investors value amid today's uncertain global market backdrop. Strong Q1 orders of $26.6 billion also reinforce confidence in sustained, durable defense demand.
The company raised its FY2026 EPS guidance to $16.45-$16.55, up from $16.10-$16.20. General Dynamics (GD) is also committing $200 million to 155mm artillery shell production in Mesquite, Texas.
That artillery shell investment answers surging ammunition demand driven by prolonged armed conflicts across several regions worldwide. According to Insider Monkey, geopolitical conflicts lifted sales across nearly all of the company's business segments.
Analysts Upgrade RTX and Boeing
As reported by Insider Monkey, Jefferies upgraded RTX to Buy from Hold on June 4, 2026. Analyst Sheila Kahyaoglu raised the price target to $220 from $210.
Jefferies projects RTX EPS of about $10.45 by 2028, more than $2 above consensus. RTX (RTX) also won a $515 million Navy SPY-6 radar contract on June 3.
Street consensus rates RTX a Moderate Buy, with roughly 22% average upside. That positive momentum strengthens RTX's standing within the defense sector.
The SPY-6 radar contract confirms RTX as a key detection-systems supplier to the US Navy. Jefferies' EPS projection well above consensus reflects strong long-term earnings expectations for the company.
Boeing also drew firm support from major analysts. Jefferies set a Buy rating with a $295 target, while Wells Fargo issued Overweight with a $250 target.
According to Insider Monkey, the Wells Fargo Overweight target was set by analyst David E. Strauss on June 1, 2026. That call reinforces the bullish analyst view on Boeing's recovery prospects.
The Street rates Boeing (BA) a Strong Buy with a $274.14 average target, about 27% above current levels. The key catalyst is China committing to 200 Boeing jets during Trump's Beijing visit.
Trump said the order could rise to 750 aircraft. That commitment serves as a powerful long-term sentiment driver for Boeing.
Gotrade is the trading name of Gotrade Securities Inc., which is registered with and supervised by the Labuan Financial Services Authority (LFSA). This content is for educational purposes only and does not constitute financial advice. Always do your own research (DYOR) before investing.
