State Street SPDR S&P Aerospace & Defense ETF (XAR) Stock Analysis
For informational purposes only. Not financial advice. Analysis by Sedat ANAK, Founder & Editor-in-Chief | AI-powered analysis. Data sourced from SEC filings and institutional-grade financial providers. Editorially reviewed. Not financial advice.
State Street SPDR S&P Aerospace & Defense ETF (XAR) trades at $271.78 with AI Score 47/100 (Grade C). The State Street SPDR S&P Aerospace & Defense ETF (XAR) aims to track the performance of… Market cap: $4.58B, Sector: Financial services.
Price as of Aug 21, 2026 · Last analyzed: Mar 17, 2026Analyst Coverage for XAR: XAR does not currently have published analyst price targets in our coverage universe. This is common for smaller-cap names with limited Wall Street coverage. In the absence of analyst consensus, our AI model evaluates XAR against Financial Services peers across nine fundamental dimensions and assigns an underweight signal based on the underlying data.
XAR: the 3 scored disciplines are evenly split. Dominant signal: Izzy Englander bullish.
How is this calculated? →Why this analysis is different
- A 9-signal quantitative MoonshotScore built from filings, insider activity, and market data — computed from the numbers, not from opinion.
- An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
- Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.
State Street SPDR S&P Aerospace & Defense ETF (XAR) Financial Services Profile
The State Street SPDR S&P Aerospace & Defense ETF (XAR) offers investors a unique opportunity to gain targeted exposure to the aerospace and defense sectors through a modified equal-weighted index, facilitating strategic investment in a rapidly evolving industry.
What Is the Investment Thesis for XAR?
The State Street SPDR S&P Aerospace & Defense ETF (XAR) is positioned to benefit from several key growth drivers, including increased government defense spending, advancements in aerospace technology, and rising global security concerns. With a market cap of $4.58B, XAR is well-positioned to capture opportunities in the aerospace and defense sectors, which are projected to grow at a compound annual growth rate (CAGR) of approximately 4.5% over the next five years. The ETF's modified equal-weighted index approach allows for diversified exposure across various market capitalizations, enhancing its potential for capital appreciation. Additionally, XAR's lack of dividend yield may appeal to growth-oriented investors focusing on capital gains. However, potential risks include fluctuations in defense budgets and geopolitical tensions that could impact sector performance. Overall, XAR serves as a strategic investment vehicle for those looking to gain exposure to the aerospace and defense industries.
Based on FMP financials and quantitative analysis
XAR Key Highlights
Market capitalization of $4.58B reflects strong investor interest in aerospace and defense sectors.
- Beta of 1.49 indicates higher volatility compared to the broader market, appealing to risk-tolerant investors.
- Utilizes a modified equal-weighted index to provide diversified exposure across various market capitalizations.
- No dividend yield, focusing on capital appreciation rather than income generation.
- Tracks the S&P Aerospace & Defense Select Industry Index, aligning with industry performance.
Who Are XAR's Competitors?
XAR is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.
| Company | Price | Change | Market Cap | AI Score |
|---|---|---|---|---|
| BKLC BNY Mellon US Large Cap Core Equity ETF | $48.72 | -0.92% | $5.57B | 44 |
| EUFN iShares MSCI Europe Financials ETF | $41.91 | -0.07% | $5.22B | 47 |
| FELG FIDELITY ENHANCED LARGE CAP GROWTH ETF | $43.67 | -0.70% | $5.80B | 44 |
| FENI FIDELITY ENHANCED INTERNATIONAL ETF | $41.40 | -0.36% | $10.9B | 47 |
| GSIE Goldman Sachs ActiveBeta International Equity ETF | $47.74 | -0.48% | $5.90B | 47 |
| FHI Federated Hermes, Inc. | $63.13 | -1.33% | $4.79B | 98 |
| CNS Cohen & Steers, Inc. | $80.79 | -0.47% | $4.15B | 71 |
| OTF Blue Owl Technology Finance Corp. | $11.16 | +0.36% | $5.16B | 75 |
AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance
What Are XAR's Key Strengths?
Strong market capitalization of $4.58B indicates investor confidence.
- Unique modified equal-weighted index approach enhances diversification.
- Established reputation as part of State Street Global Advisors.
What Are XAR's Weaknesses?
No dividend yield may deter income-focused investors.
- Higher beta indicates increased volatility compared to the broader market.
- Limited to aerospace and defense sectors, reducing diversification.
What Could Drive XAR Stock Higher?
Increased defense budgets expected to be announced in the upcoming fiscal year.
- Technological advancements in aerospace driving demand for innovative solutions.
- Rising global security concerns prompting governments to enhance military capabilities.
What Are the Key Risks for XAR?
Fluctuations in government defense budgets could impact sector performance.
- Geopolitical tensions may create uncertainty in the aerospace and defense industries.
- Competition from other ETFs and investment vehicles may affect market share.
What Are the Growth Opportunities for XAR?
- Increased Defense Spending: The global defense budget is expected to grow significantly, driven by geopolitical tensions and the need for enhanced security measures. This trend presents a substantial growth opportunity for companies within the aerospace and defense sectors, which XAR is well-positioned to capture through its diversified index approach. Analysts project that defense spending will increase by approximately 3% annually over the next five years, providing a favorable environment for XAR's underlying holdings.
- Technological Advancements: Innovations in aerospace technology, including advancements in unmanned systems, cybersecurity, and next-generation aircraft, are expected to drive growth in the sector. The demand for cutting-edge technology solutions will benefit companies in the aerospace and defense industries, enhancing their revenue potential. XAR's exposure to these companies positions it to capitalize on the ongoing technological evolution within the sector.
- Rising Global Security Concerns: Heightened global security concerns, including terrorism and cyber threats, are prompting governments to increase their defense budgets and invest in advanced military capabilities. This trend is likely to boost the performance of companies within the aerospace and defense sectors, providing a favorable backdrop for XAR. As governments prioritize national security, the ETF's holdings stand to benefit from increased contracts and spending.
- Emerging Markets Growth: Developing countries are increasingly investing in their defense capabilities, creating new opportunities for aerospace and defense companies. As emerging markets expand their military capabilities, XAR's diversified exposure allows investors to tap into this growth potential. Analysts estimate that defense spending in emerging markets will grow by approximately 5% annually, further enhancing XAR's investment thesis.
- Sustainable Defense Solutions: The growing emphasis on sustainability and environmentally friendly practices within the defense industry is creating opportunities for companies focused on green technologies. XAR's exposure to firms that prioritize sustainable solutions aligns with evolving market trends and positions the ETF to benefit from the increasing demand for eco-friendly defense products.
What Are XAR's Competitive Advantages?
- Strong brand recognition as part of State Street Global Advisors, a leading asset management firm.
- Modified equal-weighted index approach provides unique exposure compared to traditional market-cap-weighted ETFs.
- Diversification across large, mid, and small-cap stocks reduces concentration risk.
- Established relationships with institutional investors enhance credibility and attract assets.
- Expertise in asset management and ETF operations supports effective portfolio management.
What Does XAR Do?
The State Street SPDR S&P Aerospace & Defense ETF (XAR) was established to provide investors with a means of accessing the performance of the aerospace and defense sectors through a diversified investment vehicle. The ETF seeks to replicate the total return performance of the S&P Aerospace & Defense Select Industry Index, which encompasses a broad range of companies within these industries. By utilizing a modified equal-weighted index approach, XAR allows for a more balanced exposure across large, mid, and small-cap stocks, reducing concentration risk typically associated with traditional market-cap-weighted indices. This structure enables investors to take strategic or tactical positions in a more targeted manner, aligning with specific investment strategies or market views. The ETF is designed for investors looking to capitalize on the growth potential in the aerospace and defense sectors, which are influenced by factors such as government spending, technological advancements, and global security dynamics. With its headquarters in Boston, Massachusetts, State Street Global Advisors manages XAR, leveraging its extensive expertise in asset management to deliver value to investors. As of now, the ETF has a market capitalization of approximately $4.57 billion, reflecting its significant presence in the market and investor interest in the aerospace and defense sectors.
What Products and Services Does XAR Offer?
- Provide investment results that correspond to the total return performance of the S&P Aerospace & Defense Select Industry Index.
- Offer exposure to the aerospace and defense segments of the S&P TMI.
- Utilize a modified equal-weighted index for diversified investment across various market capitalizations.
- Enable investors to take strategic or tactical positions in the aerospace and defense sectors.
- Facilitate targeted investment strategies beyond traditional sector-based investing.
- Serve as a vehicle for investors seeking growth in the aerospace and defense industries.
How Does XAR Make Money?
- Generate revenue through management fees associated with the ETF's assets under management.
- Benefit from the performance of underlying securities within the S&P Aerospace & Defense Select Industry Index.
- Attract investors seeking targeted exposure to the aerospace and defense sectors.
- Leverage economies of scale as assets under management increase, reducing per-unit costs.
- Utilize a modified equal-weighted index approach to enhance diversification and reduce concentration risk.
What Industry Does XAR Operate In?
The aerospace and defense industry is experiencing robust growth, driven by increased government spending on defense and security, technological advancements, and a rising demand for aerospace products. The global aerospace and defense market is projected to reach approximately $1 trillion by 2030, growing at a CAGR of around 4.5%. In this competitive landscape, the State Street SPDR S&P Aerospace & Defense ETF (XAR) stands out by offering targeted exposure to this dynamic sector through a modified equal-weighted index approach. This allows investors to capitalize on the growth potential of both established and emerging companies within the aerospace and defense industries, positioning XAR favorably among its peers.
Who Are XAR's Key Customers?
- Institutional investors seeking targeted exposure to the aerospace and defense sectors.
- Retail investors looking for diversified investment options within the aerospace and defense industries.
- Financial advisors and wealth managers incorporating sector-focused ETFs into client portfolios.
- Pension funds and endowments aiming to diversify their investment strategies.
- Hedge funds and other active investors seeking tactical positions in the aerospace and defense sectors.
State Street SPDR S&P Aerospace & Defense ETF (XAR) Valuation Context
Valued at $4.58B, XAR is classified as a mid-cap stock. Relative to its peer group, XAR's quantitative score of 47/100 is roughly in line with the peer average of 46/100.
Key Financial Metrics
Return on equity for State Street SPDR S&P Aerospace & Defense ETF stands at 0.0%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 0.0%, showing how much profit it generates from its asset base. XAR trades at a trailing price-to-earnings ratio of 0.00, below the Financial Services sector average of ~18x. Its free cash flow yield is 0.0%, a gauge of the cash the business throws off relative to its market value. A current ratio of 0.00 means current liabilities exceed short-term assets, a liquidity point worth watching. Its earnings yield is 0.0%, the inverse of the P/E and a quick read on earnings relative to price.
XAR Financials
Bull Case vs Bear Case
Bull Case
- Recent insider buying suggests confidence in the ETF's long-term prospects, indicating a belief in the aerospace and defense sectors' growth.
- Community sentiment has shifted positively, with many investors discussing increased defense budgets and geopolitical tensions as catalysts for growth.
- The ETF's diversified holdings in leading aerospace and defense companies position it well to benefit from industry trends and technological advancements.
- Market perception has been buoyed by recent government contracts awarded to key players in the sector, reinforcing the ETF's attractiveness.
Bear Case
- Concerns over potential budget cuts in defense spending could dampen future growth expectations for the aerospace and defense sectors.
- Community discussions have highlighted volatility in global supply chains, which could impact the performance of underlying assets in the ETF.
- Recent geopolitical tensions have led to uncertainty, causing some investors to question the sustainability of current bullish sentiment.
- Market perception is cautious due to rising interest rates, which could affect capital allocation to defense and aerospace investments.
AI-generated arguments based on insider flow, news sentiment and technicals — not financial advice · March 2026
XAR Latest News
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Boeing And RTX Enter Agreements With The Pentagon To Increase Production Of Key Components Of Standard Missile-3 Block IB And Increase Production Of Components For Standard Missile-3 Block IIA Suface-To-Air Interceptors
benzinga · Aug 14, 2026
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Pentagon Commits Over $135 Billion to Patriot Missiles, Nuclear Submarines as Trump Pressures Defense Contractors to Ramp Up Production
benzinga · Jul 30, 2026
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NATO's $40 Billion Counter-Drone Push Puts These Defense ETFs in Focus
benzinga · Jul 18, 2026
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Trump Returns for Greenland’s Riches, ‘We Stupidly Gave It Back’ (UPDATED)
benzinga · Jul 9, 2026
XAR Analyst Consensus
Consensus Rating
Aggregated Buy/Hold/Sell recommendations from Benzinga, Yahoo Finance, and Finnhub for XAR.
Price Targets
Wall Street price target analysis for XAR.
XAR MoonshotScore
What does this score mean?
The MoonshotScore rates XAR 0-100 on quantitative fundamentals — growth, financial health, valuation, momentum, and risk.
Latest News
Boeing And RTX Enter Agreements With The Pentagon To Increase Production Of Key Components Of Standard Missile-3 Block IB And Increase Production Of Components For Standard Missile-3 Block IIA Suface-To-Air Interceptors
Pentagon Commits Over $135 Billion to Patriot Missiles, Nuclear Submarines as Trump Pressures Defense Contractors to Ramp Up Production
NATO's $40 Billion Counter-Drone Push Puts These Defense ETFs in Focus
Trump Returns for Greenland’s Riches, ‘We Stupidly Gave It Back’ (UPDATED)
What Investors Ask About State Street SPDR S&P Aerospace & Defense ETF (XAR) — Financial Services
What does the AI Score mean for XAR?
XAR holds an AI Score of 47/100 (Grade: C). This is an educational research signal, not a buy or sell recommendation. The State Street SPDR S&P Aerospace & Defense ETF (XAR) aims to track the performance of the S&P Aerospace & Defense Select Industry Index, providing investors with targeted exposure to …
How does State Street SPDR S&P Aerospace & Defense ETF make money in financial services?
The State Street SPDR S&P Aerospace & Defense ETF generates revenue primarily through management fees based on its assets under management. As the ETF tracks the performance of the S&P Aerospace & Defense Select Industry Index, it benefits from the performance of the underlying securities. The modified equal-weighted index approach allows for diversified exposure, which can enhance returns and attract more investors.
What regulatory challenges does State Street SPDR S&P Aerospace & Defense ETF face?
The State Street SPDR S&P Aerospace & Defense ETF operates within a regulatory environment that includes compliance with SEC regulations and adherence to the Investment Company Act of 1940. The ETF must maintain transparency in its holdings and ensure that it meets capital requirements. Additionally, changes in regulations regarding ETFs and asset management could impact operational costs and compliance requirements.
What do analysts say about XAR stock?
Analysts generally view the State Street SPDR S&P Aerospace & Defense ETF positively, noting its strategic positioning within the growing aerospace and defense sectors. Key valuation metrics indicate that the ETF is aligned with industry growth trends, and its modified equal-weighted index approach is seen as a competitive advantage. However, analysts also highlight the potential risks associated with fluctuations in defense budgets and geopolitical tensions that could affect sector performance.
What are the main risks for XAR?
The main risks for the State Street SPDR S&P Aerospace & Defense ETF include potential fluctuations in government defense budgets, which could impact the performance of its underlying holdings. Geopolitical tensions may also create uncertainty in the aerospace and defense industries, leading to volatility in the ETF's performance. Additionally, competition from other ETFs and investment vehicles poses a risk to market share and investor interest.
What are the key factors to evaluate for XAR?
State Street SPDR S&P Aerospace & Defense ETF (XAR) holds an AI score of 47/100 (low). The State Street SPDR S&P Aerospace & Defense ETF (XAR) is positioned to benefit from several key growth drivers, including increased government defense spending, advancements in aerospace technology, and rising global security concerns. Not financial advice.
How frequently does XAR data refresh on this page?
XAR's price was last updated on Aug 21, 2026 and refreshes on page view during U.S. market hours — it is not a real-time exchange feed. Fundamentals update after quarterly filings; the MoonshotScore recalculates nightly; news aggregates continuously.
What has driven XAR's recent stock price performance?
State Street SPDR S&P Aerospace & Defense ETF (XAR) moves on earnings results, analyst revisions, sector rotation, and market sentiment. Notable catalyst: Strong market capitalization of $4.58B indicates investor confidence. See the News tab for the latest drivers. Past performance does not predict future results.
Should investors consider XAR overvalued or undervalued right now?
State Street SPDR S&P Aerospace & Defense ETF (XAR) has no trailing P/E available here, so lean on price-to-sales and cash flow in the Financials tab. Compare P/E, P/S, and EV/EBITDA against sector peers for a full view.
Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.
Official Resources
Data provided for informational purposes only.
- The analysis is based on available data as of March 2026 and may be subject to change based on market conditions and regulatory developments.