The good news for Canadian defense names keeps on coming, as Carney committed an additional $9B of investment for the year.

Combined with a ~$14B reallocation of defense-related spend currently sitting in other categories, the Liberal government aims to break $60B this year, more than 2% of expected GDP - a target that was originally set for 2030.

Unlike previous defense announcements that were equipment-focused, this $9B is largely directed towards expanding our armed forces and ensuring the right infrastructure is in place for them to succeed.

The focus on “operational readiness” reads like marketing copy for Calian Group (CGY), who has handily outperformed Canadian defense peers since Monday’s announcement.

The company’s “Defense Operational Readiness Platform” represents nearly half of its revenue and is growing fast across verticals like training and technology…

… and Canada represents nearly 70% of its total revenue, with a roughly even split between government and commercial business. Put another way, CGY is the cleanest way to play the buildout of the Canadian Armed Forces.

With a >$1B backlog, steady insider buying all year, and the company trading at a 10-year low on forward earnings, it could be a good time to play a rotation to services on the defense trade.