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Further Reading from MarketBeat Defense Behemoths: Winners and Loser During Q4 Earnings CycleSubmitted by Leo Miller. Posted: 1/30/2026. A plethora of defense giants just reported their Q4 2025 earnings. The cycle saw some standout performances, as well as others that left investors wanting more. Here are the most notable winners and losers from the latest round of defense earnings. All data is as of the Jan. 30 close unless otherwise indicated. Winner: Northrop Grumman Sees Growth Accelerating in 2026 U.S. defense behemoth Northrop Grumman (NYSE: NOC) was a clear winner in its latest earnings report. Northrop is particularly known for building stealth bombers, like its B-2 Spirit craft. The company posted strong Q4 2025 earnings, released before the market's open on Jan. 27. Revenue came in at $11.7 billion, up almost 10%, and beat estimates by more than $100 million. The company's adjusted earnings per share (EPS) rose around 13% to $7.23, comfortably surpassing estimates of $6.97. In a positive sign for its outlook, Northrop expects revenue to grow in the mid-single-digit range in 2026. That would be a notable acceleration versus 2025, when sales grew by only about 2% for the full year. The former CEO of Google calls it the most important thing to happen in 500, maybe 1,000 years of human society. A former U.S. Treasury Secretary says when your great-grandchildren write the history of this period, the political headlines will be the second or third story. The first story is something none of us have seen before. The dot-com collapse, global financial crisis, and COVID-19 pandemic don't compare to what's coming next. We may be entering a period of dramatic, almost unimaginable change. See the full warning and how to prepare now. In Brief - Defense stocks soared in 2025, and many of the industry's biggest players just reported their year-end results.
- Northrop Grumman and RTX gained positive reactions from their releases, with shares and price targets rising.
- Despite shares falling, analysts are still optimistic on General Dynamics.
Northrop's results boosted optimism among investors and Wall Street analysts. Shares rose 2.7% on Jan. 27, and several analysts significantly raised their forecasts. The MarketBeat consensus price target on Northrop sits close to $689, near its Jan. 30 closing price. However, price targets issued after earnings average around $762, implying meaningful upside of roughly 10%. Winner: RTX Gains, Backlog Hits Record High RTX (NYSE: RTX) also delivered a strong quarter in Q4 2025. Sales grew 12% to $24.2 billion, beating estimates by about $1.6 billion. Adjusted EPS was essentially flat at $1.55, up less than 1%, but still above the $1.47 analysts had expected. While RTX expects sales growth to moderate in 2026, the company projects solid free cash flow growth of around 8% at the midpoint of guidance. RTX's record backlog of $268 billion also underpins its outlook, providing revenue visibility for the next few years — roughly three times its 2025 sales. Beyond defense, RTX operates in the commercial aerospace market and expects commercial airline production to continue rising in 2026, supporting both its Collins Aerospace and Pratt & Whitney businesses. Shares gained about 3.7% on the day of its Jan. 27 pre-market release. The MarketBeat consensus price target near $199 implies about 1% downside from current levels, but analyst targets issued after earnings averaged $223, implying roughly 11% upside. Loser: General Dynamics Falls on Guidance, But Analysts Still See Solid Upside On the other side of the coin, markets were underwhelmed by General Dynamics' (NYSE: GD) Q4 2025 results. Shares closed down 2.7% on the day of the company's Jan. 28 release, which was posted during market hours. General Dynamics has its hands in areas many other aerospace and defense firms do not — from making and servicing high-end Gulfstream private jets to building nuclear submarines. The company's revenue rose 8% in the quarter to $14.4 billion, beating estimates near $13.8 billion. EPS increased less than 1% to $4.17, topping expectations of $4.11. The company's guidance implies roughly 4% revenue growth in 2026, a meaningful slowdown from 10% growth in 2025. It also expects EPS to grow near 4%, versus 13% last year. Still, General Dynamics finished the year with a record backlog of $118 billion — more than double its 2025 revenue. The company guided Aerospace operating margins near 14% for 2026, below its longer-term "high teens" target. That somewhat cautious guidance was the main driver of the market's negative reaction. The MarketBeat consensus price target on General Dynamics sits near $372, implying about 6% upside. Analysts' post-earnings targets averaged $403, suggesting roughly 15% potential upside. Defense Industry Eyes Catalyst in Potential Gov't Spending Boost Looking ahead, the defense industry could get a significant tailwind from the U.S. government's next defense budget. President Trump has proposed boosting defense spending to $1.5 trillion in the next fiscal year, which would represent a 66% increase over the prior budget. That proposal is not guaranteed, however, as it would require approval from Congress.
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