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Ukraine’s defense stock premium should be managed with caution

Buying defense stocks makes sense when war breaks out. Investors should be careful though, as it also makes sense to sell them when the focus starts to shift elsewhere.

On Tuesday, shares of military contractor Lockheed Martin fell about 3% in the futures market after reporting an 8% annual decline in sales in the first quarter due to supply shortages created by the pandemic, which affected the entire industry. Earnings beat Wall Street expectations, but the company did not raise its outlook for 2022.