KeyBanc initiated coverage on the space and defense sector, naming a few top picks to own through 2026. They are bullish on companies involved in advanced warfare, missile defense, and space systems. They listed AeroVironment (AVAV) as a high-conviction idea, citing industry-leading margins and their integration of BlueHalo. Kratos (KTOS) was picked for their exposure to hypersonics and ability to undercut legacy competitors on cost. Other favorites included Karman Holdings for missile and rocket exposure, and Intuitive Machines (LUNR) for their NASA contracts and new satellite manufacturing capabilities.