The Canadian government has made defence and infrastructure spending a major priority in 2025. That is set to be a serious windfall for Canadian defence stocks. While there are not many pure play defence companies in Canada, there are plenty of stocks that could benefit. Here are five of the best defence stocks in Canada today.
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Calian Group: A diversified stock catering to Canadian defence
Calian Group (TSX: CGY) is a top Canadian defence contractor in Canada. Over 50% of its income comes from defence-related activities. It has a diversified business that provides everything from military health solutions, to advanced satellite communication, to battle planning and training simulations.
Although Calian has faced some near-term headwinds in its IT business, its military-focused businesses have been producing. The company is cheap. It’s not often you find a stock that trades with a price-to-earnings below 11. This defence stock pays a 2.3% dividend yield today.
Exchange Income
Exchange Income Corp. (TSX: EIF) operates several crucial air services to northern Canadian communities. Canada is increasingly focused on Arctic sovereignty and defence. Exchange has the network and expertise in the northern region to be a crucial asset for Canada.
This defence stock also offers leading intelligence, surveillance, and reconnaissance (ISR) software/hardware aerospace solutions around the world. Exchange is waiting to hopefully win a big contract in Australia. It also has plenty of other ISR opportunities in its portfolio and pipeline
This company is firing on all cylinders today. Collect a nice 3.5% dividend yield while its future defence growth materializes.
Bombardier
Bombardier (TSX: BBD.B) has delivered an exceptional turnaround in the past few years. Its stock is up 123% this year and 2,441% in the past five years.
Bombardier is best known for its business jets. However, the company has made a big pivot into the defence space over the past few years. It is repurposing its jets for surveillance, intelligence, and maritime patrol.
Some analysts believe its defence segment could become a $1 billion-plus business by 2030. If you want further exposure to the ISR space, this could be a top stock to consider.
Firan Technologies
Another stock with exposure to the aerospace defence market is Firan Technologies (TSX: FTG). This small cap stock supplies circuit boards, cockpit components, and aftermarket parts and sensors to aircraft manufacturers around the world.
While it is not a direct defence play, its crucial parts are installed on several military aircraft. A boon in both commercial and defence aircraft spending is helping support attractive growth opportunities for Firan.
The company has seen solid backlog growth and earnings were up over 40% this year. For a stock with a nice growth profile, its 18 times earnings valuation is very reasonable.
Kraken: A top defence growth stock
One defence stock that is not so reasonably valued is Kraken Robotics (TSXV: PNG). Even though it is down 14% this month, it trades with a forward price-to-earnings ratio of 86 times.
However, the company is one-of-a-kind. It provides deep-sea sonar and imaging products and specialized deep-sea batteries for remotely operated vehicles (ROVs). Demand for underwater drones and ROVs has drastically risen in recent years. Kraken expects to grow by over 40% this year.
Kraken is not cheap, but it has been growing rapidly. Expectations are high for this business. However, up over 750% in the past five years, it certainly has delivered on those expectations to date.
