Defense Stocks for a New Nuclear Era

DEFENSE
STOCKS FOR
A NEW
NUCLEAR ERA
By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/stock-investing-tips/defense-stocks-for-a-new-nuclear-era
The USA is about to exit a Reagan Era
nuclear weapons treaty with the
Russians.

This could set off another arms race in
weapons of mass destruction.

It could also provide profitable
investments for defense stocks in a new
nuclear era.

Zacks suggests two defense stocks to
buy if we end up in another nuclear
arms race with the Russians and
Chinese.

President Donald Trump has decided to
withdraw the United States from the
landmark nuclear weapons deal signed
with Russia in 1987 that banned both
nations from owning, producing and
test-flying nuclear missiles.

While Trump’s recent decision may not
be a welcome move for Russia, it could
be a new chapter for domestic defense
companies in terms of developing
nuclear weapons.

Therefore, it might be a good idea to
invest in some defense stocks that
stand to benefit the most.

The basis of Trump’s move is that
Russia appears to be violating the
agreement and China is not part of it.

Like the prospect of a permanent trade
war, this move may have more to do
with national defense than with anything
else.

The stocks that Zacks suggests are
Northrup Grumman and Raytheon.

Northrup Grumman makes advanced
products and provides high tech
services for intelligence, logistics,
reconnaissance, cyber operations, and
autonomous systems.

They produce, upgrade, and maintain
the country’s Minuteman III ICBM force.

Their stock is likely to grow 27% by the
end of 2018.

Raytheon also has a strong foothold in
the high tech world of products and
services with military applications.

Their focus is largely on integrating high
tech solutions and providing advanced
services.

They are currently partnering with
Lockheed Martin to upgrade US nuclear
deterrent capabilities with more
advanced designs and capabilities.

Their earnings will grow by about 30%
during 2018.

US Missile Defense
Capabilities

The risk of a new nuclear era did not
just pop up in the last few weeks.

When the USSR was falling apart the
concern was that they could not secure
their nuclear arsenal against theft or
purchase by rogue nations.

Ukraine totally removed their nuclear
arsenal and had their security
guaranteed in a treaty signed by the
USA, England, and Russia.

Today Russia has annexed Crimea, part
of Ukraine, and is supporting
separatists in Ukraine’s eastern region.

Russian adventurism and secret
programs to upgrade their nuclear
capabilities have been advancing for
several years.

Meanwhile, China is flexing its muscles
with annexation of islands in the South
China Sea and claiming those
international waters as their sovereign
territory.

Meanwhile, the USA has continued to
abide by the 1980’s nuclear agreement
signed by Reagan and Gorbachev.

Bloomberg wrote an opinion piece
earlier this year saying that the US
needs a better missile defense.

They look at the inadequacy of the US
missile defense system.

America’s primary domestic defense
system against a nuclear-missile attack
is the Ground-Based Midcourse
Defense, or GMD, with bases in Alaska
and California.

More than $40 billion has been spent on
this successor to Ronald Reagan’s so-
called Star Wars project.

Yet it has only 44 “kill vehicles”
intended to defend against a small-scale
intercontinental attack of the sort North
Korea might attempt, and its success
rate in testing is only about 50 percent.

During the Cold War, the deterrent used
by both the USSR and the USA was that
of mutual assured destruction.

Both sides had more than enough
nuclear weapons to destroy military
targets and population centers on the
other side, several times over.

During the Reagan years the USA
started the so-called “Star Wars”
program in which the USA developed a
missile defense system meant to
intercept incoming missiles and destroy
them.

That system has advanced but is far
from fool proof.

It did, however, cause the USSR to
bankrupt itself trying to keep up and
resulted in the fall of the USSR.

Today, it would appear that both Russia
and China want to assume more
dominant roles in the world and are
beefing up their militaries and advanced
capabilities.

Investors will be smart to look at
defense stocks for a new nuclear era as
this struggle of global dominance
resumes.

Defense Stocks for a New Nuclear Era

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Defense Stocks for a New Nuclear Era