European Defense Stocks Poised for Growth Amid Military Sovereignty Push, BAE Systems Up Over 21%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 16 2026
0mins
Should l Buy BA?
Source: CNBC
- Defense Spending Growth: European NATO countries' defense spending is projected to rise from 2.3% of GDP to 2.8% by 2030, which will drive increased orders for domestic defense companies and enhance their market positions.
- Strong Performance of BAE Systems: BAE Systems has gained over 21% year-to-date in 2026, leveraging its diverse manufacturing capabilities in military aircraft, weapons, and warships, positioning it well to benefit from Europe's shift towards local suppliers.
- Danish Military Spending Surge: Denmark's military spending has increased from 1.4% to 3.2% of GDP in three years, with equipment spending quadrupling, and while still reliant on U.S. suppliers, it has begun placing large orders with European firms like BAE Systems and Rheinmetall.
- Market Trend Analysis: Analysts indicate that European nations will gradually pivot towards local suppliers, with companies like BAE Systems and Rheinmetall expected to benefit, driving a long-term growth trend in the defense sector.
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Analyst Views on BA
Wall Street analysts forecast BA stock price to rise
16 Analyst Rating
14 Buy
1 Hold
1 Sell
Strong Buy
Current: 207.320
Low
150.00
Averages
269.14
High
298.00
Current: 207.320
Low
150.00
Averages
269.14
High
298.00
About BA
The Boeing Company is an aerospace company. Its segments include Commercial Airplanes (BCA), Defense, Space & Security (BDS), and Global Services (BGS). Its BCA segment develops, produces and markets commercial jet aircraft principally for the commercial airline industry worldwide. Its family of commercial jet aircraft in production includes the 737 narrow-body model and the 767, 777 and 787 wide-body models. Its BDS segment is engaged in the research, development, production and modification of manned and unmanned military aircraft and weapons systems for strike, surveillance and mobility. Its BGS segment provides services to its commercial and defense customers worldwide. It sustains aerospace platforms and systems with a range of products and services, including supply chain and logistics management, engineering, maintenance and modifications, upgrades and conversions, spare parts, pilot and maintenance training systems and services, technical and maintenance documents, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Growing Order Backlog: Despite a slump in orders following the 737 MAX incidents in 2019, Boeing's order backlog has reached a new record since 2022, indicating a recovery in market confidence about future revenues, although orders are not guaranteed.
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- Threats to Tech Companies: Iran's Revolutionary Guard has designated 18 U.S. tech firms, including Oracle, as 'legitimate targets' in retaliation for U.S. and Israeli strikes, which raises the operational risks for these companies in the Middle East.
- Rising Cybersecurity Risks: As threats against tech companies escalate, risk management expert James Henderson notes that tech assets are now viewed as integral to the conflict, suggesting future attacks may target data centers and cloud platforms, increasing security vulnerabilities in the industry.
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