Analysis of Public Aerospace and Defense Companies
The aerospace and defense (A&D) industry is not only a driver of economic growth but also a cornerstone of national security strategies. In today’s world of rising geopolitical risks, expanding defense budgets, and accelerated technological transformation, publicly traded defense companies offer investors both a safe haven and access to cutting-edge technologies.
The aerospace and defense (A&D) industry is not only a driver of economic growth but also a cornerstone of national security strategies. In today’s world of rising geopolitical risks, expanding defense budgets, and accelerated technological transformation, publicly traded defense companies offer investors both a safe haven and access to cutting-edge technologies.
Russia’s invasion of Ukraine reintroduced instability to Europe. In 2023, Hamas’ attack on Israel triggered a full-scale war in Gaza and fueled tensions with Hezbollah in Lebanon and the Houthis in Yemen. Beyond the Middle East, the traditional global order continues to shift. In this environment, aerospace and defense companies are expected to accelerate innovation, scaling, and transformation to remain competitive.
With national security concerns mounting, companies face growing pressure to source technologies—particularly advanced AI chips—from suppliers aligned with their own countries’ geopolitical interests. Emerging AI firms in Asia and other regions are beginning to challenge the dominance of U.S. players, potentially reshaping the technology market and driving democratization of AI through low-cost, open-source models.
The global A&D sector continues to expand rapidly. In 2024, worldwide defense spending grew by approximately 10%—the fastest pace in 40 years. Despite this growth, the industry remains subject to disruptive changes across multiple dimensions.
This article examines the financial performance, valuation multiples, R&D spending, cash positions, and entrepreneurial ecosystem of both global aerospace and defense giants as well as leading Turkish defense companies.
Defense Primes Segment
Median EV/Revenue (LTM): 1.8x
Median EV/EBITDA (LTM): 13.9x
Median EBITDA Margin: 11.8%
Median Revenue Growth (LTM): 4.0%
These figures reflect the segment’s mature, stable structure, with investors adopting a relatively conservative approach to valuation. Growth is modest but sustainable, and operational efficiency remains reasonable.
Defense Systems Segment:
Median EV/Revenue (LTM): 3.4x
Median EV/EBITDA (LTM): 17.6x
Median EBITDA Margin: 18.3%
Median Revenue Growth (LTM): 7.5%
Higher multiples highlight investors’ willingness to pay a premium for growth and innovation. Profitability is stronger compared to Primes, underlining the efficiency of technology-focused firms.
Defense Technology Segment:
In the median-based analysis of Defense Technology companies, valuation multiples stand out. The median EV/Revenue (LTM) multiple is 1.9x, while on an NTM basis it is 1.8x, indicating that the sector is trading at a reasonable valuation relative to revenues.
The EV/EBITDA multiple is 14.7x on an LTM basis and 12.1x on an NTM basis, highlighting that investors assign a clear premium to companies with strong cash generation capabilities. This suggests that firms with robust profitability and EBITDA generation are valued at higher multiples.
As for EBITDA margins, the median stands at 13.1% on an LTM basis and 15.9% on an NTM basis. This upward expectation signals a perception that efficiency within the sector is likely to improve in the coming period. On the revenue side, median sales growth is 4.7% on an LTM basis and 7.2% on an NTM basis, reflecting heightened growth expectations for the near future.
Homeland Security Segment:
In the Homeland Security segment, median revenue growth (LTM) stands at 4.5%, indicating a moderate level. One of the most notable companies is Axon Enterprise, which stands out with 32.3% revenue growth and an EBITDA margin of 25.0%. The sector’s median EV/EBITDA multiple is 12.2x, while the median EV/Revenue multiple is 2.3x. This demonstrates that investors reward companies in this segment that show reasonable yet solid growth and cash generation potential.
Government Services Segment:
In the Government Services segment, median revenue growth is 7.6%. Cybersecurity and software-based service providers such as Fortinet, Zscaler, and CrowdStrike stand out with very high EV/EBITDA multiples—CrowdStrike, for example, trades at an extreme outlier level of 674.9x.
The segment’s median EV/EBITDA is 16.4x, while its median EV/Revenue is 3.4x. This highlights how technology-based service providers are valued at much higher premiums compared to traditional consulting firms.
Aircrafts & Engines Segment:
In the Aircrafts & Engines segment, median figures provide noteworthy insights into the sector’s overall financial performance and valuation multiples. The median EV/Revenue (LTM) is 2.1x, while the median EV/EBITDA (LTM)stands at 17.3x. This indicates that companies in the sector are trading at relatively high valuations compared to their revenues, yet operational profitability remains fairly solid. The median EBITDA margin (LTM) is 10.5%, and median revenue growth (LTM) is 3.4%, suggesting that companies are maintaining a reasonable growth pace, with high valuations being supported by stable margins.
Aerostructures & Systems Segment:
Looking at the Aerostructures & Systems segment, the median EV/Revenue (LTM) is 3.1x, while the median EV/EBITDA (LTM) is 16.4x. This clearly shows that the segment is valued at a higher revenue multiple compared to the Aircrafts & Engines group. At the same time, the median EBITDA margin (LTM) stands at a robust 17.0%, pointing to strong efficiency levels.
Companies in this segment also stand out in terms of growth: the median revenue growth (LTM) is 5.0%, while the forecasted growth for the next year is 16.7%, reflecting positive sector expectations. Meanwhile, the median Debt/EBITDA ratio is 2.3x, indicating limited leverage and suggesting that growth could be sustainable. Firms such as TransDigm and AMETEK contribute to upward deviations in these averages due to their strong profitability and premium multiples.
Space Segment:
Examining the financial performance of companies operating in the Space segment reveals the following median figures: Revenue (LTM) of $242 million, EBITDA (LTM) of - $39 million, Revenue Growth (LTM) of 36.8%, and an EBITDA Margin (LTM) of -10.0%. These numbers indicate that the sector is still in its investment and growth phase, hosting many companies that have yet to achieve profitability. Notably, firms such as Intuitive Machines, Rocket Lab, and Planet Labs report significantly negative EBITDA figures, underscoring the challenge of reaching operational profitability.
From a revenue standpoint, the median level remains low, suggesting that many companies in the segment have not yet achieved economies of scale.
Looking at valuation multiples, the median EV/Revenue (LTM) stands at 4.0x, while the median EV/EBITDA (LTM) is 11.4x. These multiples demonstrate that despite negative EBITDA margins, investors are assigning premiums based on the future growth potential of these firms. For instance, BlackSky Technology trades at an extraordinary EV/EBITDA multiple of 343.4x, reflecting strong market confidence in its potential—though this also entails significant risks.
The median Debt/EBITDA ratio is 0.0x, indicating that companies in the segment are generally relying on equity financing rather than heavy debt to fund their growth. In conclusion, the Space segment consists of high-growth companies that promise significant potential but have not yet demonstrated sustainable profitability.
Aerospace & Defense M&A
In the second quarter of 2025, the Aerospace and Defense (A&D) sector witnessed relatively stable merger and acquisition (M&A) activity compared to the previous three quarters. The passage of the “One Big Beautiful Bill Act” on July 4 largely eliminated budget-related uncertainties. However, tariff-related issues introduced by President Trump after the April 2 “Liberation Day” celebrations remained on the agenda. On June 4, President Trump also raised tariffs on steel imports from 25% to 50%. Despite these developments, overall deal appetite in the sector remained strong.
Notable Q2 transactions included:
Silvus Technologies acquired by Motorola Solutions for $4.4 billion
Blue Halo acquired by AeroVironment for $4.1 billion
RTX’s Simmonds Precision Products unit sold to TransDigm for $765 million
Amentum’s Rapid Solutions unit acquired by Lockheed Martin for $360 million
These deals clearly demonstrate the interest of large, strategic players in pursuing inorganic growth opportunities.
Other noteworthy agreements included Anduril’s acquisition of Klas, a leader in edge computing and tactical communications, as well as Kongsberg’s acquisition of Sonatech to enhance its capabilities in underwater acoustics. These developments highlight the aggressive investment and expansion strategies pursued particularly by U.S.-based companies in the defense and space technologies sector.
Conclusion:
As of 2025, the global aerospace and defense (A&D) sector has entered a significant growth phase driven by geopolitical uncertainties, accelerating technological transformation, and rising defense expenditures. Airbus and Boeing expect deliveries of 40,000 new commercial jets over the next 20 years, while defense spending has surged by 10%, marking the fastest growth in four decades. Mergers and acquisitions (M&A) activity has also risen markedly, with major players such as Motorola, AeroVironment, TransDigm, and Lockheed Martin pursuing billion-dollar acquisitions as part of their aggressive growth strategies. Among the segments, Defense Technology has stood out with 68.5% growth, while the Space & Satellite segment recorded an unprecedented increase of 87.4%.
Based on median figures, the most mature and stable segment—Defense Primes—is conservatively valued at 1.8x EV/Revenue and 13.9x EV/EBITDA. By contrast, Defense Systems trades at higher multiples of 3.4x EV/Revenue and 17.6x EV/EBITDA, reflecting its technology-intensive nature. Defense Technology firms stand out with 1.9x EV/Revenue and 14.7x EV/EBITDA, signaling expected efficiency gains with a forecast EBITDA margin of 15.9%. In Government Services, valuation multiples are even higher at 3.4x EV/Revenue and 16.4x EV/EBITDA, underscoring the prominence of technology-driven firms such as Fortinet and CrowdStrike within this segment. Meanwhile, despite strong revenue growth of 36.8%, the Space segment remains unprofitable with a median EBITDA of -$39 million, showing that valuations are based largely on future potential (median EV/Revenue of 4.0x).
Overall, the aerospace and defense sector presents a dynamic structure, offering segment-based opportunities where investors assign differentiated premiums according to profitability, growth, and technological capabilities.
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