Executive Mosaic’s GovCon Index recorded gains from Tuesday to Friday, ending the week at a record high of $5,538.65. Besides the 2.39% week-on-week gain, the index tracking the stock performances of 30 major government contractors registered a third straight winning week in August and a 4.74% month-on-month gain.
Wall Street’s major U.S. stock indexes also ended positive before the weekend. The Dow Jones Industrial Average and Nasdaq Composite had identical 0.9% weekly gains, while the S&P 500 advanced 0.2% overall.
On the GovCon Index, AeroVironment (Nasdaq: AVAV) rose 9.77% to $203.76 in five days following a record-size $990 million contract award mid-week from the U.S. Army to supply Switchblade munitions for soldiers in infantry battalions. Market analysts say the defense contractor and robotics company has visible revenue streams through 2029.
So far, in 2024, AeroVironment is up 61.66%, although AI stock Palantir Technologies (NYSE: PLTR) remains the best-performing GCI constituent with a +83.34% market-beating return. Nonetheless, both stocks carry “buy” to “strong buy” ratings from market analysts.
On a year-to-date basis, the GovCon Index outperforms Wall Street with +18.64% compared to the S&P 500’s +18.42% and Nasdaq Composite’s +18%. The Dow Jones Industrial Average hit three record highs this week but lags with +10.28% for the year.
The economic calendar after the Labor Day holiday includes job openings and initial jobless claims. Sept. 18 is the date to watch when Fed Chairman Jerome Powell will announce the policy rate decision, a likely first cut in over four years.
