RTX, LMT, and BA Draw Value Investors Amid Rising Defense Spending Outlook

Defense stocks, particularly RTX Corp (RTX), Lockheed Martin (LMT), and Boeing (BA), are emerging as compelling opportunities for value-oriented investors and traders employing out-of-the-money (OTM) options strategies. With global military expenditures projected to rise by over 5% in 2026, driven by regional conflicts and strategic realignments, defense equities are benefiting from heightened structural tailwinds. RTX, for instance, reported $39 billion in backlog as of year-end 2025, up 12% year-over-year, signaling sustained demand for its aerospace and defense segments. The appeal extends beyond fundamentals. RTX’s forward price-to-earnings ratio stands at 14.3, below the S&P 500’s 22.1, while LMT trades at 15.6 and BA at 13.9, suggesting relative undervaluation. These valuations are especially attractive given their exposure to high-margin programs such as the F-35 fighter (LMT), hypersonic systems (RTX), and commercial aerospace recovery (BA). The combination of stable earnings, consistent dividends, and low volatility makes them ideal for long-term value positioning. For options traders, the defensive nature of these stocks and their potential for asymmetric upside make OTM calls appealing. RTX’s 5% out-of-the-money call options with a 90-day expiry have seen volume spike 180% over the past month, reflecting speculative interest tied to potential budget increases or major contract wins. Similar movements are observed in LMT and BA, with implied volatility rising to multi-year highs in the defense sector. The broader market impact includes a potential rotation into defensive sectors, particularly as inflation pressures ease and interest rates stabilize. Investors are increasingly favoring companies with predictable cash flows and low capital intensity, a profile well-met by RTX, LMT, and BA. These dynamics could support steady outperformance in the aerospace and defense space over the next 12 to 18 months.