Key Points

• Barclays launched coverage of 20 aerospace and defense companies with a broadly positive view of the sector.
• Boeing, RTX Corp., Rocket Lab, CAE, DPC, Kratos and Karman received Overweight ratings.
• The bank sees opportunities tied to aircraft production, aerospace components, missiles, drones and space technology.
• Barclays was more cautious on traditional defense contractors, rating Northrop Grumman Underweight and Lockheed Martin Equal Weight.

Barclays sees investment opportunities across aerospace and defense, describing the sector as an important driver of a new U.S. industrial expansion.

The bank’s outlook is selective. It favors several commercial aerospace and emerging-technology companies, but sees a less attractive balance of risks and potential returns at some established defense contractors.

Boeing and RTX Stand Out for Expected Cash-Flow Growth

Valentini expects Boeing (BA) to return to more normal free-cash-flow growth. His outlook rests partly on increased 737 MAX production and anticipated certifications for the 777X and 737 MAX-10.

Those are expected catalysts, not completed milestones. Barclays’ positive view depends in part on Boeing making progress on production and aircraft approvals.

For RTX Corp. (RTX), Valentini sees potential for results to exceed Wall Street expectations and for free cash flow to grow faster than industry peers. He highlighted three drivers:

• More Collins Aerospace equipment and components on newer-generation aircraft.
• Improved performance at Pratt & Whitney.
• Raytheon’s exposure to missile demand.

Both Boeing and RTX received Overweight ratings.

Barclays Also Favors Space, Drones and Electric Aircraft

The bank’s positive ratings extend beyond the largest aerospace companies. Other Overweight selections include:

• Rocket Lab (RKLB), a space company.
• CAE Inc. (CAE), a flight-training company.
• DPC Holdings (DPC), a supplier of cast parts.
• Kratos (KTOS) and Karman (KRMN), suppliers serving drone and rocket markets.

Separately, it reports Overweight ratings for SpaceX and Palantir Technologies (PLTR), with price targets of $254 and $265, respectively.

Northrop Grumman Gets a More Cautious Rating

Barclays initiated Northrop Grumman (NOC) at Underweight. Valentini sees more potential downside than upside from changes in U.S. military spending as elections approach.

Lockheed Martin (LMT) received an Equal Weight rating. Although Barclays did not place it among its preferred stocks, Valentini believes investor sentiment is too negative given the company’s significant missile exposure.

The contrast shows that Barclays’ optimism about aerospace and defense does not apply equally to every company in the sector.

Investor Takeaway: Barclays Favors Specific Growth Drivers

Barclays’ preferred names offer exposure to different growth opportunities, from higher aircraft production and stronger cash flow to missiles, drones and space technology.

The central message is that company-specific opportunities matter more than a blanket bet on the sector. Boeing’s production and certification progress, RTX’s operating performance, and the direction of military spending remain important factors behind the analyst’s calls.

The post Barclays Sees Opportunity in Aerospace and Defense, Favoring Boeing and RTX appeared first on PRISM MarketView.

COMTEX_1001057886/2927/2026-10-12T13:42:20