Defense Stocks on the Offensive

The Aerospace/Defense Sector is hot and the stocks are breaking out. As a group of the 25 stocks that trade 100,000+ shares a day with a market cap greater than $300M it is one of the cheapest groups on valuation as well, here are some stats on the average company metrics:

Forward P/E: 13.5X; Price/Sales: 1.3X; Price/Book: 2.6X; Price/Cash: 13X; Price/Free Cash Flow: 20.9X; EPS Growth this Year 10.7%

There are some great individual value plays here, names that are lesser known like Esterline (ESL) and Triumph Group (TGI).

Here are a few of the charts I like in this group, break outs with a lot of upside:

BE Aerospace (BEAV), Boeing (BA), General Dynamics (GD), Goodrich (GR), L-3 (LLL), Northrop Grumman (NOC), Orbital Sciences (ORB), and Raytheon (RTN). Lockheed Martin (LMT) is the noticeable laggard.