Though the defense industry has to sooner than later develop creative strategies and business models or risk catastrophic failure, we at Blackhawk Partners believe that despite a challenging environment, strong fundamentals in the defense and most importantly cyber security industry and unmanned aviation continue to offer some highly attractive investment opportunities.
We believe the industry’s fate largely depends on Pentagon’s decisions on how it will modernize U.S. forces to confront future threats. In its Cold War heyday, the Pentagon was the leading developer of cutting-edge technology and still commands the world’s most advanced military force. But at the same time, it has created self-defeating mechanisms that quash innovation and fail to capitalize on available opportunities. The United States is still way ahead of competitors in areas such as fighter aircraft and submarines. But there are segments of the weapons market such as ballistic missiles and cruise missiles where other people are doing quite well compared to us.
Continue Reading: On the Challenges and Opportunities We See in the Defense Industry