Analysts: "Buy Europe" will boost European defense stocks

On March 10, Berenberg analysts said that Europe’s military budget will grow by at least a high single digit until 2035, and at the same time, regional governments will also promote the order of European defense equipment instead of American equipment, which will boost European defense stocks. They point out that the UK has pledged to increase its defence spending to 2.5% of GDP by 2027, which is higher than they expected and will particularly benefit QinetiQ and Babcock International, which derive more than half of their revenue from the UK Ministry of Defence. The agency’s first choice is the German arms manufacturer Rheinmetall.