10-14-2013, 12:40 PM
Welcome to the group, sagitarius!
I agree with you completely. The world is not getting any safer, sad to say, so I don't think defense budgets are going down any time soon. Though I did see a recent article arguing that defense companies are chronically undervalued, from a p/e perspective anyway, so while they may be great investments, it may not be a good idea to bank on p/e expansion.
(10-14-2013, 12:06 PM)sagitarius84 Wrote: The whole defense contractors look like an interesting sector today. Everyone is scared that the defense budgets will be frozen, when in all respect it is unlikely that more than a 10% drop from the highs will occur. Since defense companies are cheap, I think they could be good buys from here
I agree with you completely. The world is not getting any safer, sad to say, so I don't think defense budgets are going down any time soon. Though I did see a recent article arguing that defense companies are chronically undervalued, from a p/e perspective anyway, so while they may be great investments, it may not be a good idea to bank on p/e expansion.