Global defence spending has increased steadily over the past decade. The Ukraine-Russia conflict has
pulled in major powers across the developed world. Moreover, some experts have warned that great
power conflict could again rear its head in the decades to come. Investors may want to snatch up
defence stocks in this environment. Today, I want to look at two TSX stocks that fit the bill.
CAE (TSX:CAE)(NYSE:CAE) is a Montreal-based company that provides simulation training and critical
operations support solutions to a worldwide client base. Its shares have dropped 23% in 2022 as of close
on August 26. The stock is down 30% year over year.
The company released its first quarter fiscal 2023 results on August 10. It reported revenue of $933
million compared to $752 million in the previous year. Meanwhile, it announced a record $10.0 billion
backlog. This TSX stock is trading in attractive value territory compared to its top competitors.
Heroux-Devtek (TSX:HRX) is another Quebec-based company that is engaged in the design,
development, manufacture, assembling, and repair and overhaul of aircraft gear and components.
Shares of this TSX stock have dropped 28% so far in 2022.
It reported total sales of $114 million – down from $126 million in the previous year. However, it did win
a new contract with Boeing for the repair and overhaul of the F-18 main landing gear and side braces.
This TSX stock possesses a favourable P/E ratio of 17 at the time of this writing.
