US defense and aerospace stocks are back in focus as fresh government commitments to border security, Space Force expansion, and recruitment funding reshape expectations for contractors and service providers. With US$70b earmarked for border initiatives, including US$26b for Border Patrol, investors are looking closely at companies tied to military, space, and security spending. This article outlines how the latest policy moves may influence revenues, risk, and sentiment, and then examines 3 stocks from our US Defense and Aerospace Sector screener that appear positively exposed to these trends.

Enpro (NPO)

Overview: Enpro is an industrial technology company that supplies high performance sealing systems, precision components, and advanced surface treatments that protect critical equipment in sectors such as semiconductor manufacturing, energy, aerospace, defense, and life sciences.

Operations: Enpro generates about US$751.8m in revenue from Sealing Technologies and US$422m from Advanced Surface Technologies, with roughly US$664.6m coming from customers in the United States and the rest spread across Europe, Asia Pacific, and other regions.

Market Cap: US$7.1b

Investors watching defense and aerospace may monitor Enpro because it sits in the supply chain for critical components used in space launches, aerospace systems, and secure industrial processes that could be influenced by changes in US defense and border security spending. The company is connected to high value areas such as semiconductor equipment, where management has highlighted opportunities from domestic chip capacity and support from policies like the CHIPS Act, but this comes with execution risk on new facilities and expansion projects. Forecast earnings growth is described as strong, yet current profit margins are modest and a recent large one off loss shows that results can be lumpy. With a relatively high P/S multiple and all liabilities funded by external borrowings, investors need to weigh quality exposure against valuation and balance sheet risk.

Enpro’s exposure to high-value semiconductor and defense markets appears compelling, but the combination of a rich P/S ratio, external borrowings and uneven results warrants closer examination through the 1 key reward and 2 important warning signs

Matrix Service (MTRX)

Overview: Matrix Service is an engineering and construction company that builds and maintains critical energy and industrial infrastructure, from LNG and hydrogen storage tanks to power substations and specialty facilities for aerospace and defense clients. It focuses on complex, large scale projects that support energy security, electricity reliability, and advanced industrial processes.

Operations: Matrix Service generates most of its roughly US$847.8m in revenue from Storage and Terminal Solutions at US$420.0m, supported by Utility and Power Infrastructure at US$282.9m and Process and Industrial Facilities at US$144.9m, with the bulk of sales coming from US customers.

Market Cap: US$352.5m

Matrix Service may catch investors’ attention because it sits at the intersection of energy security, grid reliability, and defense related infrastructure at a time when US policy is prioritising border protection and military readiness. The company has moved closer to profitability, with recent quarters shifting from losses to modest net income. A large project pipeline in LNG, electrical infrastructure, and specialized aerospace facilities ties directly into themes highlighted on recent analyst calls. At the same time, Matrix Service still carries execution and funding risk, with past margin pressure, reliance on external borrowings, management turnover, and a CFO transition that puts more focus on delivery. For investors, the key question is whether this mix of improving results and a high risk capital structure can support a sustained rerating as defense and security spending rises.

Matrix Service’s shift toward profitability and busy project pipeline may only be half the story, with its capital structure and execution record doing more work than many investors realize, and the 4 key rewards and 1 important warning sign

Xometry (XMTR)

Overview: Xometry runs an AI powered online marketplace that connects buyers needing custom manufactured parts with a global network of suppliers, using instant quoting and digital tools to manage complex orders. Its platform serves customers across aerospace, defense, automotive, medical devices, and other industrial sectors that value speed, flexibility, and traceability in production.

Operations: Xometry generates about US$740.8m in revenue from Internet Software & Services, with roughly US$618.2m from the U.S. and US$122.6m from international markets.

Market Cap: US$5.2b

Investors looking at defense and aerospace exposure may find Xometry interesting because its AI driven marketplace directly feeds precision parts and assemblies into contractors that could see different demand dynamics in connection with U.S. spending on border security, Space Force, and military technology. The company is focused on long term trends such as digital procurement, supply chain localization, and data center build outs, supported by partnerships such as Siemens’ US$50m equity commitment and integration into industrial software platforms. At the same time, Xometry remains unprofitable, carries funding risk after a US$225m equity raise, and trades on a relatively high P/S multiple. Progress on profitability targets, international expansion, and AI product adoption will be important factors for shareholders evaluating this defense related growth story.

Xometry’s AI marketplace story is accelerating, but the real twist is how its push toward profitability and funding choices fit together. To learn more, take a look at the analyst forecasts for Xometry

The three stocks in this article are just a starting point, and the full US Defense and Aerospace Sector screener surfaces 39 more defense and aerospace companies with equally compelling fundamentals and stories that could fit different approaches to government related spending themes. Use Simply Wall St to identify, filter, and analyze the specific catalysts and narratives that matter most to you so you can focus on the highest conviction ideas in this sector.

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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.