Defense stocks have a long runway amid rising global tensions

Watch on YouTube ↗ | January 07, 2026 at 13:15 | 7:50 | CNBC

Speakers

Paul Marino — Chief Revenue Officer at Themes ETFs

Daniel Maguire — Autonomous Technology & Robotics Research Analyst at ARK Invest

Frank — Host

Summary

Paul Marino of Themes ETFs and Daniel Maguire of ARK Invest discussed why defense and aerospace stocks may have a long runway as geopolitical tensions rise and NATO/European nations increase military spending. Marino favors pure-play defense exposure, including the Transatlantic Defense ETF (NATO), and sees Northrop Grumman as a naval shipbuilding play. Maguire highlighted space and defense themes, including the Space and Defense ETF, the shift to low-cost unmanned autonomous jets, Kratos, Rocket Lab, and SpaceX exposure through ARK Venture Fund. Both guests framed the backdrop as supportive of multi-year defense and space investment, with Marino viewing defense valuations as fairly priced.

Geopolitical tensions and NATO/European defense budget increases underpin a long-run defense and aerospace thesis.
Paul Marino favors pure-play defense exposure via the Themes Transatlantic Defense ETF (NATO) to complement tech-heavy portfolios.
Marino names Northrop Grumman as a way to play naval shipbuilding and broader naval capabilities.
Daniel Maguire sees space and defense as in vogue and highlights the Space and Defense ETF.
Maguire points to a shift from manned fighter jets to low-cost unmanned autonomous jets, naming Kratos as a leader.
Maguire also emphasizes defense satellites and names Rocket Lab as a high-conviction national security launch provider.
Maguire says SpaceX exposure is available through ARK Venture Fund, where it is a top holding.
Marino views defense stock valuations as fairly priced given expected NATO spending.

Ideas

Paul Marino Chief Revenue Officer at Themes ETFs 1:17

Long runway for defense and aerospace.

Geopolitical tensions involving Venezuela, China/Taiwan, Russia/Ukraine and Greenland, plus the US’s demonstrated military superiority, are forcing Europe and NATO members to build up their own defense capabilities and close the military gap. He expects a long runway for defense and aerospace stocks over the next three, five, maybe even ten years, and later notes NATO’s commitment to raise spending toward 5% of GDP supports the sector; he views valuations as fairly priced.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 1:56

Space and defense now in vogue.

The changing geopolitical environment, including Venezuela and NATO countries increasing defense budgets, makes space and defense an attractive area; he says space and defense is in vogue.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 2:01

Space defense ETF has research-driven holdings.

He highlights the Space and Defense ETF as an established vehicle, launched in March 2021, with holdings supported by research-driven decisions and exposure to disruptive innovators such as Kratos.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 2:09

Kratos leads low-cost autonomous jet shift.

Kratos is a top holding in ARK’s ETF and a leading provider of unmanned, low-cost autonomous jets that are ready to be fielded today, making it a direct beneficiary of the government shift away from manned fighter jets.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 2:13

Shift from manned jets to drones.

He sees a clear emerging trend of governments shifting defense dollars away from expensive manned fighter jets and toward low-cost unmanned autonomous jets. This shift should benefit suppliers of unmanned autonomous systems.

Paul Marino Chief Revenue Officer at Themes ETFs 3:29

Pure-play defense complements tech-heavy portfolios.

He prefers a pure-play defense exposure to complement portfolios that already have large technology positions. While technology and traditional defense primes both play a role, he says the cleaner way to get pure defense exposure is the Themes Transatlantic Defense ETF (NATO).

Paul Marino Chief Revenue Officer at Themes ETFs 3:55

Naval shipbuilding play via Northrop Grumman.

With the Trump administration emphasizing naval capabilities and US shipbuilding, Northrop Grumman is a way to play the renewed naval buildout. He notes naval ships and aircraft help enable airstrikes, supporting the broader defense spending thesis.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 4:48

Defense satellites are critical for defense.

For any defense initiative, satellites are critical, and rockets are required to put satellites into orbit. This creates a decision-useful investment theme around defense satellites and space-based capabilities.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 4:56

Rocket Lab key national security launch play.

Satellites and national security require launch capability. Rocket Lab is one of ARK’s highest-conviction names, is the most active Western launch provider outside SpaceX, is leaning into national security, and recently won its largest contract—over $800 million—for national security satellites.

Daniel Maguire Autonomous Technology & Robotics Research Analyst at ARK Invest 6:43

SpaceX exposure through ARK Venture Fund.

SpaceX has cut launch costs by an estimated 95% since 2008, enabling more satellites in orbit and reinforcing ARK’s high-conviction research case. Because SpaceX is private, he points to access through ARK Venture Fund, where it is the top holding.

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This CNBC video, published January 07, 2026, features Paul Marino, Daniel Maguire discussing ITA, ARKX, KTOS, Low-cost unmanned autonomous jets, NATO, NOC, Defense satellites, RKLB, ARKVX. 10 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Paul Marino, Daniel Maguire · Tickers: ITA, ARKX, KTOS, Low-cost unmanned autonomous jets, NATO, NOC, Defense satellites, RKLB, ARKVX