Western governments are recommitting money and equipment to Ukraine, and that fresh focus on military support is rippling through defense and aerospace stocks. For investors, the question is whether this mix of new aid packages, potential Patriot missile decisions, and increased funding for drone warfare creates opportunity or added risk. This article looks at how the G7 statement, the US$8b US aid bill, and rising interest in Ukrainian military technology may affect parts of the sector. It also highlights 3 stocks from our Defense and Aerospace Stocks screener that appear closely exposed to these headlines.

Modine Manufacturing (MOD)

Overview: Modine Manufacturing designs and sells thermal management systems that keep everything from data centers and building HVAC equipment to vehicles and industrial machinery running at safe, efficient temperatures, offering products such as heat exchangers, unit heaters, data center cooling units and battery thermal management systems across multiple regions.

Operations: Modine generates most of its revenue from Climate Solutions at about US$2.1b, with a further US$1.1b from Performance Technologies and small corporate eliminations, while the United States is its largest geography at roughly US$1.7b in sales.

Market Cap: US$15.7b

Investors looking at defense and aerospace exposure may find Modine Manufacturing interesting because its thermal systems sit inside many mission critical assets, from military vehicles and powertrains to energy efficient data centers that support AI workloads. The recent multi year, multi billion dollar data center cooling agreements and capacity deals give the company unusually clear revenue visibility, but they also raise execution risks around expansion, acquisition integration and a planned spin off of legacy businesses. Forecasts for strong earnings and revenue growth contrast with a high P/E multiple and a history of one off charges, so the key question is whether Modine’s data center and defense aligned opportunities justify that premium and balance out funding and concentration risks.

Modine’s data center momentum and defense exposure could be masking a very different earnings path ahead, so it is worth seeing how analysts connect the dots in the analyst forecasts for Modine Manufacturing

Electrovaya (TSX:ELVA)

Overview: Electrovaya develops and sells lithium ion battery systems and related technology for warehouse vehicles, robotics, electric buses and trucks, defense applications, and grid energy storage. Its products target long life, safety, and performance for mission critical uses.

Operations: Electrovaya generates about US$71.2m in revenue from developing, manufacturing, and marketing power technology products, with roughly US$67.9m from the United States, US$2.7m from Canada, and a small contribution from other regions.

Market Cap: CA$717.4m

Electrovaya sits at the intersection of defense spending, warehouse automation, and grid storage, which is why fresh G7 commitments, new US aid for Ukraine, and a larger US drone and defense budget are drawing attention to its batteries and solid state technology. Management highlights growing orders from defense contractors and interest in domestically produced systems for secure, high safety applications. Robotics and material handling are also described as important revenue drivers. At the same time, the stock trades on a high P/E, funding relies heavily on higher risk sources, and shareholders have faced dilution, so expectations are demanding. For investors tracking defense exposed battery suppliers, the mix of potential growth, concentration in US demand, and governance questions makes Electrovaya a company that may warrant closer examination.

Electrovaya’s high P/E and defense aligned battery orders hint at a story where expectations may be racing ahead of what the balance sheet and funding mix can comfortably support, which is why the Electrovaya financial health report

EHang Holdings (EH)

Overview: EHang Holdings is an urban air mobility company that designs, builds, and operates autonomous aerial vehicles and supporting systems for passenger transport, cargo logistics, smart city monitoring, and drone light shows across multiple regions including China, Asia, the Americas, Africa, and Europe.

Operations: EHang currently generates all of its CN¥417.5m in revenue from Aerospace & Defense activities.

Market Cap: US$533.2m

Investors watching drone warfare and higher defense budgets may find EHang Holdings interesting because its autonomous eVTOL aircraft and urban air mobility platform sit in the dual use space that can benefit when governments increase funding for drones and related infrastructure. However, the company still faces delayed commercial approvals, rising costs, and a heavy reliance on China for orders. Analyst forecasts in the market point to revenue and earnings growth over time, and the stock is trading below some fair value estimates even after recent losses and guidance cuts. This places more attention on whether EHang can turn technical progress, government relationships, and its order backlog into reliable and profitable international operations.

EHang’s stalled approvals and heavy China exposure sit beside an urban air story some investors may be underestimating, so it is worth seeing how revenue expectations stack up in the analyst forecasts for EHang Holdings

The 3 stocks here are only a starting point, as the full Defense and Aerospace Stocks screener surfaces 24 more companies tied to defense and aerospace with equally compelling narratives around national security, mission critical tech, and capital intensity. Use Simply Wall St to identify and analyze the specific catalysts, funding profiles, and business models that matter most to you, so you can focus on the ideas in this space that best align with your own highest conviction.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.