The headlines are everywhere.

Unprecedented rise in global military spending.

New defense pacts.

Billions earmarked for advanced weapons systems.

It’s easy to get caught up in the story. Wall Street is certainly selling it hard. The narrative says that a rising tide of government spending will lift all boats in the defense sector.

But narratives don't generate free cash flow.

We look beyond the stories and focus on the numbers.

We do the tedious work of reading the footnotes, reversing accounting distortions, and calculating the true, underlying profitability of a business.

When you do this for the defense sector, the popular narrative falls apart.

You discover that many of the biggest names - the ones you see praised on financial television - are not the sound investments they appear to be.

Their valuations are disconnected from their economic reality. Except for one stock.

Disclaimer: Past performance is not indicative of future results. Investing involves risk, including the potential loss of principal.