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Peace and Prosperity

US Arms Makers’ Stocks at Record Highs on Saudi Deal


The weekend finalization of a US arms deal with Saudi Arabia which officials say will be worth at least $350 billion over the next decade sent the stocks of politically well-connected US arms makers soaring to all-time highs, underscoring just how much money there is to be had in keeping Saudi Arabia awash in weapons to drop on Yemen.

Lockheed Martin is the biggest “winner,” most analysts agree, with some $28 billion in weapons and equipment out of the initial $110 billion going to them, and likely to get the biggest sum out of anyone else in the subsequent parts and maintenance that will bring it to a record $350 billion overall.

Others say Raytheon may be a “dark horse” for investors, with the company’s wildly expensive Patriot missile systems likely to be a substantial chunk of the Saudi purchase. Still, it’s hard to see them matching Lockheed’s sale of planes to drop more bombs on Yemen.

Still, when picking winners the situation is very much relative, as when the arms makers all belly up to the bar to get a chunk of this deal, you can bet the Trump Administration will ensure all the big ones get a taste. That’s why virtually all the big arms makers, and not just Lockheed and Raytheon, are touching record highs. Everybody’s got something coming here, and with $350 billion to go around, it can’t help but be big for them.

President Trump is eager to present the deal as good for jobs, good to the economy, and Wall Street is eager to project winners. You don’t need a crystal ball to predict the losers, of course. Top of the list is Yemen, and following closely behind is whomever else the Saudis decide to attack with all these costly weapons in the years that follow.

Reprinted with permission from
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