Beyond Intel: Small energy, defense stocks set to gain from Trump natsec spending

InvestorPlace markets analyst Thomas Yeung has spotlighted three small-cap companies that could benefit from U.S. national security investments in private businesses, such as Intel. Two are in the energy sector and stand to benefit from efforts to reshape the nuclear fuel supply chain. The third, from the defense sector, is seen as a potential beneficiary of the creation of the new U.S. "Golden Dome" missile defense system.

In the U.S., according to Yeung, a new "New Deal" is unfolding as the Trump administration continues Biden-era spending initiatives meant to improve national security by supporting specific industries. Among those industries are AI, nuclear power, and defense. In July, the Department of Defense announced a $400 million investment in MP Materials Corp. to secure access to rare earth materials, while the following month, the White House announced the purchase 10% of Intel Corp. Over the next several years, legendary investor Louis Navellier believes trillions more government dollars will flow into private businesses to help offset the rise of Chinese competition. Industries from chipmaking to national defense will find the government at their doorstep, offering billions of dollars in grants and loans, Yeung writes. Below are the stocks "riding the spending spree."  

President Trump plans to rain money down on American uranium startups, Yeung argues. He recommends Uranium Energy (market capitalization $5.5 billion) and Energy Fuels ($3.4 billion) as "almost certainly worth a second look." 

Uranium Energy, operating in the U.S., Canada and Paraguay, is a startup that has spent the past decade acquiring mining sites and conversion facilities. It has since become America’s largest uranium company by estimated resources, licensed production, and processing capacity, even though much of this is not yet online, Yeung wrote. Shares rose 4% after U.S. Energy Secretary Chris Wright said that the government is now “furiously at work” to remake domestic nuclear-fuel supply chains, which includes bulking up its strategic reserve of uranium.

Seven Wall Street analysts unanimously recommend Uranium Energy shares as a "buy," but their target prices have not been revised in recent months. As a result, their current average target of $11.13 per share is already 8.5% below the stock’s last closing price, according to MarketWatch.

Energy Fuels, whose shares jumped nearly 25% after Wright’s remarks, owns the only operating conventional uranium mill in the U.S. and has produced two-thirds of all U.S. uranium since 2017. It also has a small rare-earths division, another industry favored by the U.S. government, Yeung notes.

Energy Fuels has six “buy” ratings versus one “hold” from Wall Street analysts. Their average target price of $12.37 per share implies downside of nearly 17% from the latest close, MarketWatch data shows.

However, Yeung cautions that these companies remain risky bets and are not “official” recommendations. They are relatively early-stage and operate in an industry that resembles OPEC, while Canadian and Kazakh rivals have far better pricing power. 

Drone maker Ondas Holdings, Yeung reckons, will likely become an "essential component" of the U.S. Golden Dome project, which could cost as much as $831 billion over two decades. If completed, it will add a multilayer defense system to protect the U.S. from aerial threats.    

It was the first company to receive certification by the FAA for an automated aerial security drone, and it launched a “drone-in-a-box” system in 2023 designed to hunt other drones.  

Analysts expect revenues to triple this year to $27 million, versus $7.2 million in 2024, and to reach $123 million by 2027, Yeung said.

Ondas has five “buy” ratings versus one “hold” and one “sell” from Wall Street analysts, MarketWatch data shows. The average target price is $5.90 per share, implying a 12% downside from the last close.

The AI translation of this story was reviewed by a human editor.