from a contentious election night, but it is where they will find "an attractive buying opportunity" post-election, according to Morgan Stanley analysts Kristine Liwag and Matthew Sharpe.
Defense spending from the White House, be it Democrat or Republican-controlled, is expected to rise because "US military superiority is no longer guaranteed," the analysts said, citing the Department of Defense. "Hence, we expect Defense Investment Accounts to grow regardless of political control." "President Barack Obama campaigned in 2008 on cutting the Defense budget during peak US troop deployment in the Middle East and in a period in which US military technology was unmatched by peers and near-peers," they said. "Meanwhile, presidential candidate Joe Biden has not been as vocal on cutting the Defense budget so far."
They continued: "A change in political control generally creates volatility in defense multiples; however, when Presidents see second terms, Defense multiples typically see lower highs and higher lows, a trend we expect to hold if President Trump is re-elected.
Someone expects a war