War Stocks: What to Buy if America invades Iran
Since you can't buy stock in America's elite Team 6, your weapons of choice are Raytheon Company. (RTN), Lockheed Martin Corporation (LMT), Northrop Grumman Corp. (NOC), The Boeing Company (BA), and the PowerShares Aerospace & Defense ETF (PPA). These are the major securities you can buy that will reap the benefit of increased share prices should America go to war with Iran.
Things are not looking good with Iran, and last week U.S. Defense Secretary Leon Panetta let the world know on 60 Minutes that we're ready to pull the trigger if necessary. Panetta expressed concerns over Iran developing a nuclear weapon within the next year and stated the U.S. "will take whatever steps are necessary to stop it," and that there are "no options off of the table." Today President Obama ordered the freezing of Iranian government assets in the US, including transactions by the Iranian Central Bank, in tightened sanctions over Tehran's nuclear programme.
The conflict is arising during an election year and it could be a slam dunk for Americans to keep Obama in office if things get nasty. Bush had the Iraq War as his legacy, will Obama repeat the process with Iran? Let's hope not we are not invading for make believe WMD's (the ultimate 'Doh!') but Iran did just ban the Simpsons. Reason enough?
Mastery is not going to enter in a political debate as to who will win the election, rather we turn our focus to the war stocks.
Boeing Co (BA) shares have traded between $56.01 and $80.65 over the past 12 months. Boeing Co shares closed Monday at $75.46 with a P/E Ratio of 14.4 and EPS of 5.33. BA currently pays a 2.33% annual dividend yield.
Lockheed Martin Corp (LMT) shares hit a new 52-week high today and closed at $85.25. Lockheed shares are now trading with a P/E Ratio of 10.8 and EPS of 7.77. LMT pays out a 4.69% annual dividend yield.
Raytheon Co (RTN) shares have traded between $38.35 and $53.12 over the past 12 months. Raytheon Co. is at $49.30 a share which pays a 3.49% annual dividend yield. RTN shares clock a P/E Ratio of 9.3 and EPS of 5.29.
Northrop Grumman Corp (NOC) shares are at $58.80 a share and are near the middle of its 12 month range. Northrop pays a 3.4% annual dividend yield with a P/E Ratio of 7.8 and EPS of 7.54.
If you don't want to risk you bet on just one of the war stocks then buy up the PowerShares Aerospace & Defense ETF (PPA). The PPA is trading 5% way from its 12 month high and goes for $19.69 a share.
MASTERY Bottom line:
America could be at war with Iran before 2013.
We like taking a chance on the sector via the PPA but also like all the dividend war stock picks mentioned in this article. They are all going to run higher should a conflict occur but Mastery believes Lockheed (LMT) is the best of the bunch.
Forget banking coin, in all honesty let's hope diplomacy actually prevails and we avoid sending our soldiers into a difficult situation.
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