Rising bond yields, stubborn core inflation and energy market tensions are pushing many investors to look more closely at sectors tied to national security and long-cycle government spending. The Aerospace And Defense screener focuses on companies that manufacture or provide services to these critical industries, an area that often sits at the crossroads of geopolitics, technology and long-term contracts. In the context of higher policy rate expectations and geopolitical risk, this article highlights 3 stocks from the Aerospace And Defense screener that stand out on current fundamentals, helping you decide whether they deserve a place on your watchlist.

Howmet Aerospace (HWM)

Overview: Howmet Aerospace is a Pittsburgh based manufacturer that supplies high performance engine parts, fasteners, structural components and forged aluminum wheels to aircraft, defense and heavy truck customers worldwide, focusing on critical metal components that need to be strong, precise and lightweight.

Operations: Howmet Aerospace generates most of its revenue from Engine Products at US$4.6b, followed by Fastening Systems at US$1.8b, Engineered Structures at US$1.1b and Forged Wheels at US$1.1b, with minor inter segment eliminations of US$18m.

Market Cap: US$108.5b

Investors watching aerospace and defense may find Howmet Aerospace interesting because it sits in the middle of demand for next generation commercial aircraft, defense programs and gas turbines, while posting profit margins of 20.2% and returns on equity of 31.6%. The stock trades on a rich P/E multiple and carries a high debt load, with recent insider selling and a relatively new management team adding governance questions. With upcoming Q2 2026 results and several price target changes, the key question is whether Howmet’s margin profile and capacity investments justify paying a premium for the stock or call for more caution.

Howmet’s premium P/E, 20.2% margins and 31.6% return on equity suggest a stronger story than headline debt and insider selling imply, so it is worth reviewing the 2 key rewards and 2 important warning signs

Rocket Lab (RKLB)

Overview: Rocket Lab is a Long Beach based space company that launches small and medium rockets and builds satellites, spacecraft components and mission software for commercial clients, aerospace contractors and government agencies worldwide, aiming to be an end to end provider of space infrastructure and services.

Operations: Rocket Lab generates about US$452.5m of revenue from its Space Systems segment and US$227.1m from Launch Services.

Market Cap: US$45.9b

Investors watching the Aerospace and Defense screener may find Rocket Lab interesting because it combines a growing launch business with a larger space systems segment, a sizeable backlog around US$2.2b and the planned Iridium acquisition. That deal would add a global satellite communications network and more recurring revenue potential. At the same time, the stock is still loss making, relies on external funding, carries a high P/B multiple and has seen recent insider selling and sharp price swings. This raises questions about how quickly Neutron, Iridium integration and defense contracts can support a sustained move toward profitability and justify the current valuation.

Rocket Lab’s mix of launch potential, space systems revenue and the planned Iridium deal hints at a very different earnings profile than the headline losses suggest, and the analyst forecasts for Rocket Lab could reveal how quickly that story might change.

Moog (MOG.A)

Overview: Moog is a New York based engineering company that builds precision motion and fluid control systems for aerospace, defense and industrial customers, supplying critical components that help aircraft, missiles, satellites, medical devices and heavy machinery operate safely and accurately.

Operations: Moog generates about US$1.2b of revenue from Space and Defense, US$1.0b from Industrial, US$944m from Military Aircraft and US$985m from Commercial Aircraft.

Market Cap: US$12.5b

Investors interested in Moog are often drawn to its mix of defense exposure, industrial automation and aerospace aftermarket services. These together support recurring revenue and earnings quality, as seen in recent record quarterly sales and higher net profit margins. At the same time, the company carries high debt, faces tariff and working capital pressures and is tied closely to defense budgets and specific aircraft programs. Insider selling may also give some readers pause. With earnings growing faster than its 5 year trend and management still targeting efficiency gains and portfolio simplification, the tension between a premium valuation and these risks makes Moog a stock where the full story sits beneath the headline numbers.

Moog’s mix of record sales, defense exposure and industrial automation hints at an earnings profile many investors may be underestimating. The analyst forecasts for Moog could show whether current expectations are missing a crucial twist.

The three aerospace and defense stocks discussed here are only a starting point. The full Aerospace And Defense screener surfaces 298 more companies that carry equally compelling narratives around national security, long cycle programs and critical engineering. To identify and analyze the highest conviction ideas for your watchlist, use the Aerospace And Defense screener to filter for the exact catalysts and storylines that matter most to you.

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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.