Wanted to start a discussion on BAE Systems as its a stock I own but is on my shortlist of potential stocks to transition out of in coming months.
So curious to hear peoples FOR and AGAINST arguments.
- BAE are a defence play (as in military, not defensive stock), so that is unique in my portfolio. Also a UK based defence play which with Brexit could yield some benefits if we have to ramp up spending (as some recently announced).
- They also have good sales to other countries military like the US.
- Reliable dividend of over 4.5%
- Stable company as contracts often many years with govts (who dont go bankrupt generally)
- Based historically on previous highs, upside share price growth potential might be 30% (so less then many other options), and this could take years.
- US may decrease spending on military under Biden.
- After COVID will UK in coming years reign in military spending to pay off debts?
Military and Defence is something I know very little about, so that and some of my recent analysis of other stocks in my portfolio has meant BAE has come under fire from my portfolio trimming.