BlackRock Global Dividend Fund on BAE Systems
Thesis
BAE Systems detracted as tensions in the Middle East de-escalated and reduced near-term support for defense stocks. BlackRock nevertheless remained constructive on the holding because it sees supportive long-term industry and fundamental drivers. The investment case therefore looks through short-term changes in geopolitical sentiment in favor of the longer-term defense backdrop.
“We remained constructive on the fund’s memory exposure, as well as Shell and BAE, given supportive long-term industry and fundamental drivers.”
Key risks
- De-escalation in geopolitical tensions can reduce near-term support for defense stocks