Government contracts can move stocks—but the impact depends on who’s getting the deal.
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For major contractors like Lockheed Martin, even multi-billion dollar awards are part of normal business. With nearly $19 billion in revenue per quarter, a single new contract won’t move the needle much.
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But for smaller-cap companies, it’s a different story. A large government contract can significantly increase future revenue—and the stock price often reacts fast. That’s where this scenario becomes valuable. Filtering for smaller market cap companies reveals where contract awards can trigger outsized moves.

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Here’s a real example:
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On March 5, 2025, Visionary Holdings jumped 186% in a single day after being awarded a government contract. This wasn’t just a press release—it triggered a full-on breakout. For a company of GV’s size, the contract signaled a major shift in growth potential, and the market responded immediately.
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But not all contracts are the same. Some are labeled IDIQ or indefinite delivery, indefinite quantity. That means the government can spend up to the amount listed—but isn’t required to. So before taking a position, it’s important to check whether the contract value is guaranteed.

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Contract size and duration also matter.

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A $10 billion deal sounds huge, but spread over 10 years, it only adds $1 billion per year. If the company currently generates $1 billion in annual revenue, that still doubles the business—but the impact on share price may unfold gradually as investors process the news.
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How to trade it.

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Short-term traders might jump in on the initial breakout and ride momentum for one to three days.
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Swing traders can wait for a pullback, then enter as longer-term investors step in.
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Long-term investors might use the scenario to identify companies stacking multiple contracts over time, pointing to steady, scalable growth.
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Companies like Fluor have doubled in value over two years through back-to-back government wins—evidence that repeated success in this space can drive sustained returns.
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You can refine the data by focusing on smaller market cap companies and confirmed contract values to find the most impactful setups.
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Whether you’re trading the first spike or evaluating a long-term growth story, the Government Contracts scenario helps you spot opportunity early—based on real revenue, not just headlines.
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Watch the video here:

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FAQs about Government Contracts

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What company holds the most government contracts?

Companies like Lockheed Martin, Boeing, and Raytheon often lead due to their significant roles in defense and aerospace.

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How are government contracts awarded?

Contracts are typically awarded through a competitive bidding process where companies submit proposals evaluated against specific criteria like cost and technical capabilities.

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How to win military contracts?

To win military contracts, companies need to meet strict criteria, understand the bidding process deeply, and often engage in lobbying and legal activities.

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What is the best state for government contracting?

States such as Virginia, California, and Maryland are prominent in government contracting thanks to their proximity to federal operations and military bases.

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What is the easiest government contract to get?

Smaller, simplified acquisition contracts are generally easier to secure, as they are below a certain dollar threshold and have a less complex bidding process.

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Who is the richest government contractor?

The largest aerospace and defense companies, like Lockheed Martin, Boeing, and Northrop Grumman, are typically the wealthiest due to the extensive nature of their government contracts.

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Who is the world's largest defense contractor?

Lockheed Martin is often recognized as the largest defense contractor globally, providing a wide range of military and civilian services.

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What is the most common government contract?

Fixed-price contracts are common, where the payment does not vary based on the resources used or the time expended.

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