The U.S. Space Force has awarded contracts worth up to $3.2 billion to 12 companies, including aerospace and defense companies Lockheed Martin (LMT) and SpaceX, to build early versions of space-based missile interceptors. These systems are part of President Donald Trump’s “Golden Dome” plan and are meant to destroy enemy missiles in space before they reach Earth. As part of the program, companies are expected to show working prototypes by 2028. However, this technology is still unproven, which makes it both important and risky.
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In addition to Lockheed and SpaceX, several other firms were selected, including Northrop Grumman (NOC), General Dynamics (GD), and RTX Corporation’s (RTX) Raytheon unit, as well as smaller firms. These contracts were given through a fast-track process designed to avoid delays and increase competition. Because of this, the military can move more quickly as missile threats continue to improve in speed and complexity.
However, the cost of the project is a major concern. The Congressional Budget Office estimates that building a full system of these interceptors could cost as much as $542 billion over 20 years. As a result, defense officials have made it clear that affordability will be critical and that the project may not move forward if it becomes too expensive.
Which Aerospace and Defense Stock Is the Better Buy?
Turning to Wall Street, out of the four stocks mentioned above, analysts think that LMT stock has the most room to run. In fact, LMT’s price target of $674.15 per share implies almost 33% upside potential.
