After President Trump signed an executive order, “Prioritizing the Warfighter In Defense Contracting,” outlining parameters and making a strong push to tie the ability to buy back stock and pay dividends to contract performance, Jefferies sensitized each of the Primes to include no share repurchases in 2026-27 assumed in its models and estimates General Dynamics (GD) being most impacted, followed by Northrop Grumman (NOC), Lockheed Martin (LMT) and RTX (RTX). However, the analyst also noted that President Trump has called on Congress to increase the FY27 defense budget to $1.5T from $1T in FY26, so the firm ran a second scenario with $100B of additional budget dollars over three years spread across six major contractors.
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