Leonardo DRS stock pops 8% as Trump’s $1.5 trillion defense budget call lifts contractors

New York, Jan 8, 2026, 13:17 (EST) — Regular session

Leonardo DRS shares rise about 7.5% in early afternoon trade, riding a defense-sector bid
Trump’s proposed 2027 military budget and talk of tighter rules on payouts refocus attention on defense contractors
Company recently disclosed a chief operating officer appointment in an SEC filing

Leonardo DRS shares climbed about 7.5% on Thursday, extending a sharp run higher as defense stocks rallied in early afternoon New York trade.

The move followed President Donald Trump’s call for a $1.5 trillion U.S. military budget for 2027, far above the $901 billion approved for 2026, which pushed investors back into defense names. “There is significant uncertainty associated with a final defense budget,” RBC Capital Markets analysts led by Ken Herbert wrote. Reuters

In the broader market, defense shares stood out even as tech stocks dragged on the Nasdaq, and the S&P 500 aerospace and defense sub-index touched an all-time high. “The defense budget is growing, if anything,” said Joe Saluzzi, partner and co-founder at Themis Trading, arguing investors were brushing off political pressure for now. Reuters

Leonardo DRS also filed an 8-K on Jan. 6 under SEC rules for corporate events, flagging changes under the section covering senior officer appointments. SEC

The company said it named long-time executive Sally Wallace as executive vice president and chief operating officer, with Chief Executive John Baylouny calling her “a strong leader and a trusted partner.” Wallace said she was “honored to take on this increased responsibility.” Leonardo DRS

Leonardo DRS sells defense electronics and related systems and services to U.S. military customers, and its largest stockholder is Italy’s Leonardo S.p.A., a recent quarterly filing shows. SEC

Still, the policy backdrop is messy. Trump criticized contractors’ use of dividends and share buybacks — repurchases that shrink the share count — and has pushed companies to speed up production, a stance that could collide with how the sector returns cash to investors. Investopedia

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