Kim Bolton, President and Portfolio Manager at Black Swan Dexteritas (BSD), has outlined a bullish long-term outlook for technology stocks, with a particular focus on the defence sector. His analysis comes at a time when global markets are navigating mixed performance, with strong corporate earnings offset by trade and tariff uncertainties.
“Without a doubt, the artificial intelligence theme is driving corporate capex and the stock markets higher,” Bolton said. “An intriguing sector of growth is the modern defence ecosystem. Artificial intelligence is transforming the modern defence landscape by enabling smarter, faster, and more autonomous military capabilities. AI is becoming a force multiplier in both strategic planning and tactical execution across the defence sector.”
Bolton’s top picks for the current market include Elbit Systems, AeroVironment, and Kratos Defense & Security Solutions. These companies are at the forefront of defence innovation, leveraging AI and other advanced technologies to enhance military capabilities.
Elbit Systems, an Israeli-based defence contractor, is a global leader in advanced defence systems, including C4ISR, unmanned aerial systems (UAS), and cyber solutions. With a strong financial foundation and a robust portfolio, Elbit is well-positioned to capitalise on the growing demand for cutting-edge defence technologies.
AeroVironment, an American aerospace and defence firm, specialises in unmanned systems and robotic technologies. The company’s innovative solutions are in high demand among defence and government customers worldwide, making it a key player in the evolving defence landscape.
Kratos Defense & Security Solutions, another American defence contractor, serves U.S. federal government clients and allied nations. The company’s expertise in unmanned systems and advanced technologies aligns with the growing trend towards autonomous defence capabilities.
Bolton’s past picks, including Microsoft, Meta Platforms, and CyberArk Software, have delivered impressive returns, averaging 45% total return. This track record underscores his ability to identify high-growth technology stocks with long-term potential.
As the market navigates the typically volatile month of August, Bolton remains optimistic about the long-term prospects for technology stocks. “Your BSD team remains bullish long-term and plans to add to positions on a dip in the markets, targeting new highs later this year,” he said. By focusing on companies that exhibit longer, more lucrative investment runways, Bolton aims to deliver sustained growth for investors.
The defence sector, in particular, is poised for significant advancements as AI continues to revolutionise military capabilities. Bolton’s strategic picks reflect a forward-looking approach that aligns with the evolving needs of the defence industry. As the global security landscape evolves, companies like Elbit Systems, AeroVironment, and Kratos Defense & Security Solutions are likely to play pivotal roles in shaping the future of defence technology.
