HII - This Defense Stock Could Be Perfect for Patient Value Investors -- But Here's the 1 Big Catalyst It Needs
2024-06-01 07:07:00 ET
I invest in defense stocks . And for the longest time, the defense stock that's consistently appeared to be the best value stock on my radar is military shipbuilder Huntington Ingalls (NYSE: HII) , the company that builds about half of America's nuclear submarines and all of its super-expensive nuclear-powered aircraft carriers .
Now, as you may have noticed, global conflict has been front of mind, with Russians invading Ukraine, Houthis targeting ships in the Red Sea, and China sending warships to bully neighbors ( and build artificial islands ) in the South China Sea. Given the environment, it's no surprise that a lot of defense stocks have gotten rather expensive, trading at 150%, 200%, and, in one notable case, 300% of their historical average valuation of 1 times annual sales.
Not Huntington Ingalls, though. Valued at just 14.4 times trailing earnings, and 0.9 times trailing sales, Huntington Ingalls today is the only defense stock that currently meets my standard of costing under 1 times sales .
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This Defense Stock Could Be Perfect for Patient Value Investors -- But Here's the 1 Big Catalyst It Needs