• On June 27, 2026, Leonardo DRS, Inc. was removed from multiple Russell growth benchmarks, including the Russell 1000, 2500, 3000, 3000E, Midcap, and Small Cap Composite Growth indices.
• This broad index removal reduces the stock’s presence in growth-focused portfolios and may influence how both active and passive investors view its role in the defense sector.
• With Leonardo DRS losing its place in several Russell growth indices, we’ll examine how this index exit affects its investment narrative.

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Leonardo DRS Investment Narrative Recap

To own Leonardo DRS, you need to believe in sustained demand for its defense electronics and sensing technologies, supported by large U.S. government programs and ongoing modernization. The recent removal from several Russell growth indices mainly affects how growth-focused funds access the stock, but it does not directly change contracts, backlogs, or technology programs. For now, the most important near term catalyst remains execution on existing programs, while concentration in U.S. defense budgets is still the key risk.

The upcoming second quarter 2026 earnings call on July 30 is especially relevant in light of the index removals, because it gives management a chance to update investors on orders, backlog, and margins after a period when the stock has been repriced by the market. How the company discusses funding visibility, program wins, and its response to cost and supply chain pressures will likely shape how investors reassess both the growth story and the risks around contract dependence.

Yet while index removal might seem technical, the bigger risk investors should be aware of is how dependent Leonardo DRS remains on future U.S. defense budget priorities and...

Leonardo DRS' narrative projects $4.5 billion revenue and $433.1 million earnings by 2029. This requires 7.1% yearly revenue growth and a roughly $143.1 million earnings increase from $290.0 million today.

Uncover how Leonardo DRS' forecasts yield a $52.90 fair value, a 24% upside to its current price.

Exploring Other Perspectives

Compared with the baseline, the most cautious analysts paint a tougher picture, highlighting that even with projected revenue of about US$4.4 billion and earnings near US$531.6 million by 2029, their thesis already leaned on expanding naval ties and new technologies, and the fresh index exit could give you one more reason to compare these different narratives before deciding which better fits your expectations.

Explore 4 other fair value estimates on Leonardo DRS - why the stock might be worth as much as 38% more than the current price!

Decide For Yourself

Don't just follow the ticker - dig into the data and build a conviction that's truly your own.

• A great starting point for your Leonardo DRS research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free Leonardo DRS research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Leonardo DRS' overall financial health at a glance.

No Opportunity In Leonardo DRS?

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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.