Current global conflicts from Ukraine to the Gaza Strip are going to sustain defense spending by governments for quite some time, even in an era of cost-cutting, Citigroup aerospace and defense analyst Jason Gursky said Wednesday.
That, in turn, will benefit defense contractors, who are already up 25 percent as a group in the last year.
"We see the governments reacting to constrained budgets by reducing the outlook for the number of soldiers and their fleets in order to sustain weapons spending so they are prepared for future conflicts," Gursky said in an interview with CNBC's "Power Lunch."
On Wednesday, two Ukrainian fighter jets were shot down by pro-Russian separatists. In the Middle East, Israel pressed its offensive in the Gaza Strip. And tensions are increasing in the South China Sea, where a dispute is flaring between China and several other Asian countries over energy exploration rights and claims to islands.
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The biggest beneficiaries of the global instability "are going to be those companies that support things that fly and float," Gurksy said.
That means names like Lockheed Martin, General Dynamics, Huntington Ingalls Industries and Northrop Grumman.
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General Dynamics and Northrup Grumman reported Wednesday.
—By CNBC's Michelle Fox. Reuters contributed to this report.