ASX defence stocks are in the spotlight right now as ongoing geopolitical instability worsens and governments hike defence budgets.
Investors are scrambling to get in on the action, too.
ASX defence stock superstars like Droneshield Ltd (ASX: DRO) and Electro Optic Systems Holdings Ltd (ASX: EOS) have seen their share prices skyrocket over the past 12 months.
Droneshield shares have jumped 293.2% over the past year alone. The counter drone technology company was one of the fastest-growing stocks on the planet last year.
Meanwhile, EOS has secured several major contract wins recently, and its shares have risen 728% over the same 12-month period.
The returns are impressive, and investor and analyst sentiment suggest the share prices of these ASX defence stocks could keep climbing higher this year.
But there are some other lesser-known ASX defence shares which could also experience a boom in value this year.
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Titomic Ltd (ASX: TTT)
Titomic specialises in metal additive manufacturing (cold spray technology), which has applications in defence (and other markets). The company manufactures, repairs, and upgrades military equipment using advanced materials such as titanium. This can be done while the equipment is active in the field.
The company's quarterly update, posted in late January, revealed global expansion plans, new defence contracts, and strong cash reserves of $35.8 million as of 31st December 2025.
Titomic also recently announced plans to relocate its corporate headquarters to the US as part of its strategy to grow its defence and aerospace business.
At the time of writing, the Titomic share price is up 2.27% to 22 cents. Over the past month, the shares have climbed 7.14%, but they're still 13.46% lower over the year.
Just yesterday, Bell Potter confirmed its speculative buy rating and 50 cents price target on the ASX defence stock. That implies a 122.22% upside at the time of writing. The broker said it thinks 2027 could be the year that Titomic's production really starts to kick off.
Austal Ltd (ASX: ASB)
Austal is an Australian-based global shipbuilding company specialising in the design, construction, and support of defence and commercial vessels.
These include naval vessels, defence surface warfare combatants, and law enforcement patrol boats.
The company also installs and maintains vessel command and control systems, communication and radar technology, and information management systems.
At the time of writing, Austal shares are down 1.25% for the day to $4.75 each. Over the past month, the shares have fallen 18.49%, but they're still 24.98% higher than this time 12 months ago.
The company recently cut its earnings guidance for FY26, citing an accounting issue. The news spooked investors and triggered a sell-off.
Most analysts continue to hold a bullish stance on the ASX defence stock. Data shows three out of six analysts have a strong buy rating, two have a hold rating, and one has a strong sell rating.
The average target price is $6.70, which implies a potential 40.96% upside over the next 12 months, at the time of writing. Although some think the shares could jump 61.97% to $7.71 each.
