NEW YORK ( TheStreet) -- Defense and security-related stocks are raking in gains for investors. Stocks like Lockheed Martin (LMT), Raytheon (RTN) and L-3 Communications (LLL) have delivered returns of 5% to 11% over the week ended Friday. Other stocks like General Dynamics (GD), FLIR Systems (FLIR) and American Science and Engineering (ASEI) may offer upside in the upcoming days.
The stocks rose last week after the U.S. government announced cuts in defense spending that weren't as deep as predicted. The U.S. decided to slash around $80 billion in defense spending, including a cutback of up to 50,000 troops over the next five years.
Recent statement from the U.S. government indicate growing uneasiness about China's military clout, which could trigger a restart of some advanced projects that were kept on hold. This could unlock avenues in research and development. The opening up of big defense markets like India and Saudi Arabia also is positive news for U.S. defense companies.
The companies listed here are trading at an average of 10 to 15 times their earnings, and at a discount to their historical average of 15 to 20 times. The stocks are stacked in terms of percentage buy ratings, great to greatest.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV