Aerospace stocks have taken a beating during the coronavirus crisis, but those with defence exposure now offer cheap opportunities, according to Morgan Stanley.
The shunning of this sector has been exacerbated by a growing preference among investors for more environmentally and socially responsible sectors, as well as the massive headwinds a lot of aerospace companies face with governments pouring money into fighting the pandemic, rather than other causes, such as defence spending.
"While higher government deficits create a degree of concern on budgets, we see several supportive factors," they said, listing the following: "We do not perceive as much of an austerity agenda in government policy in key markets as we did post-GFC"