Matthew Akers picks two defense stocks to buy amidst Ukraine war
- Invesco Aerospace & Defense ETF (PPA) has shot up over 10% since the start of the Ukraine war.
- Matthew Akers says the uptick will sustain as governments commit to increased defense spending.
- The Wells Fargo analyst explained why he is bullish on L3Harris and General Dynamics stocks.
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The Invesco Aerospace & Defense ETF (PPA) has shot up more than 10% over the past two weeks as Russia’s Putin made it clear that he’s out to achieve his goal in Ukraine via “negotiation or war”.
Matthew Akers reveals his favourite defense stocks
According to Wells Fargo’s Matthew Akers, the trend is likely to sustain, considering the geopolitical tensions are making governments commit to increased spending on defense. Revealing his favourite stocks in this space on CNBC’s “Squawk Box”, he said:
We’re overweight General Dynamics where you not only get the defense budget benefit but also a strong business growth and recovery from here. We also like L3Harris, it’s a bit cheaper on pension-adjusted earnings. I think it’s well-suited because you’re more platform agnostic.
A top U.S. Senate Republican sees the need for a 5.0% increase in defense spending.
Ukraine war updates: latest developments on Monday
As Russia continues its military operation in Ukraine that’s resulted in $10 billion in infrastructure damages so far, veteran investor Bill Ackman says the third world war has likely already started.
Also on Monday, the U.S. indicated it was ready to ban Russian oil and natural gas even without its European allies, sending WTI briefly to $130 a barrel. Consequently, the oil stocks are in the green today.
Meanwhile, Russia and Ukraine have concluded the third round of peace talks, which the latter says were “positive”, but the former disagrees.