How Trump shook up defense stocks this week

President Donald Trump caused some commotion for investors in U.S.defense contractors this week.

First, Trump criticized the companies for taking too long to produce military equipment and also failing to maintain it while at the same time paying out billions in dividends and stock buybacks to investors.But then the president proposed a $1.5 trillion defense budget for 2027, a big jump from the $901 billion provisioned for 2026.

Shares of Lockheed Martin, General Dynamics, Northrop Grumman and Raytheon parent RTX fell after the criticism but then roared back at the prospect of more lucrative government contracts down the road.A look at Trump's comments and how they relate to U.S.

defense contractors.Trump on Truth Social: “While we make the best Military Equipment in the World (No other Country is even close!), Defense Contractors are currently issuing massive Dividends to their Shareholders and massive Stock Buybacks, at the expense and detriment of investing in Plants and Equipment.

This situation will no longer be allowed or tolerated! ...Therefore, I will not permit Dividends or Stock Buybacks for Defense Companies until such time as these problems are rectified.”Popular ReadsVenezuela live updates: Trump says opposition leader to visit White House3 hours ago37-year-old woman fatally shot by ICE officer in Minneapolis identifiedJan 7, 6:56 PMFBI releases images of seized motorcycles as search for Ryan Wedding continuesDec 30, 4:51 PMTrump: “Executive Pay Packages in the Defense Industry are exorbitant an d unjustifiable ...

From this moment forward, these Executives must build NEW and MODERN Production Plants, both for delivering and maintaining this important Equipment, and for building the latest Models of future Military Equipment.Until they do so, no Executive should be allowed to make in excess of $5 Million Dollars which, as high as it sounds, is a mere fraction of what they are making now.”Trump: “ I have determined that, for the Good of o...