A Surprising Military Powerhouse That Could Lead Us to Profits

In a bid to counter China's rising military threat, the Biden administration is leaning heavily on an old, but unassuming, partner. It's a country known for its rugged beauty and abundant beaches. Tourists come from all over the world to explore its Great Barrier Reef. Furthermore, this country gave rise to rock and roll groups […] You're receiving this email as part of your subscription to Michael Robinson’s Trend Trader Daily [Unsubscribe](. [Trend Trader Daily] A Surprising Military Powerhouse That Could Lead Us to Profits May 05, 2023 In a bid to counter China's rising military threat, the Biden administration is leaning heavily on an old, but unassuming, partner. It's a country known for its rugged beauty and abundant beaches. Tourists come from all over the world to explore its Great Barrier Reef. Furthermore, this country gave rise to rock and roll groups like AC/DC, INXS, and Crowded House, all of which became global sensations representing the "land down under." I'm of course talking about Australia, a nation most folks wouldn't think of as a military powerhouse. But thanks to a $268 billion initiative from the White House (more on this later), this country is on pace to become a thriving naval power. And trust me, that means plenty of upside for investors like us. > ADVERTISEMENT < Like Tesla on steroids Elon Musk is creating Tesla Automotive's biggest competition. He's just launched Tesla Energy Ventures that will deal in "PVAB" energy. As Musk recently said: "I expect [PVAB] to be roughly the same size as Tesla's automotive business." According to global energy research agency Wood Mackenzie, Tesla's energy business is already growing faster than its car business. Unfortunately, Tesla Energy Ventures is not yet publicly traded. But there is still a way to get in to the PVAB energy space right away. [Click here for more details](. A Valuable Asset Australia is a considerably valuable asset. Not only does it sit at a strategic point in the Pacific, but it's an English-speaking country that shares many cultural values with the West. It's also a huge land mass that's developed significant economic sway in recent years. That's due to its abundance of natural resources and economic transparency. But here's the thing: Given its unique position as a Western nation stuck in the East – and given China's focus on more regional, if not global, economic power – Australia is playing a much larger role as an American military ally. The U.S. has had lengthy military alliances with Japan and the Philippines, but both countries are so close to China that America can't operate on a scale that provides a strategic deterrence to China's expansion efforts. Until recently, the Aussies were primarily under the security umbrella of the British and European defense alliances. That's why the 2021 diplomatic and global defense "Big Deal of the Year" was when the U.S. stepped in and stole a massive $68 billion French deal to build conventional subs for Australia. As you can imagine, the French weren't pleased – they were blindsided by the side deal. But the secret pact was brokered because France was dragging its feet on providing conventionally powered submarines for the Australian navy. The U.S. understood that China was taking advantage of the lack of progress by Australia and France. The fact is, China was moving deeper into the Pacific, establishing port deals with smaller island nations. Time was of the essence. As it happens, I see a terrific investment opportunity amidst this entire situation. And it relates to the prime contractor leading the charge on this new U.S. sub deal. Details on the Deal To be clear, this deal is worth about $4 billion in the short term. But analysts project that, through 2030, Australia's naval modernization will cost as much as $268 billion, much of it funded by the U.S. and UK. Under the pact, the priority is to deliver up to five nuclear-powered Virginia class attack subs that can carry nuclear and non-nuclear cruise missiles, as well as hypersonic missiles. Delivery is expected by 2032, which shouldn't be a problem since this company is already delivering state-of-the-art subs to the U.S. Navy. These will be the first nuclear subs in Australia's navy. As a result, U.S. and UK navies are already beginning to visit Australia more often. On March 13, the Biden administration said the U.S. will embed Aussie sailors aboard American ships to begin training them. And by 2040, the AUKUS partnership – Australia, United Kingdom, and United States – will be in full swing. All three nations will pledge billions to boost Pacific readiness. The Advantage of Nuclear Subs Nuclear subs were the ideal solution for Australia – as they are for the U.S. – because these vessels can stay at sea for years thanks to their own onboard reactors. They don't need to constantly refuel. This makes them strategically more effective because they're also very difficult to track, and they run much quieter than diesel-powered subs. Given the increasing tension with China over Taiwan, and with growing trade issues between China and Australia, these subs will force China to recalculate how it manages expansion, both economically and militarily. But these subs are just one arrow in the quiver of the defense company I'm recommending... Plenty of Action Last December, this company landed a $5 billion contract to upgrade America's Columbia-class subs. These next-generation vessels are 2.5x bigger than Virginia-class subs and will serve as the workhorses of the Navy's sub program for the next four decades. A few months earlier, the company received a $533 million contract to upgrade the U.S. Virginia class sub fleet. Bear in mind that this company does far more than build subs. Its programs extend to significant armaments and equipment for use on land and in the air. For example, some of its other divisions are key suppliers for Ukraine's efforts against Russia. And its European business is a key partner for North Atlantic Treaty Organization ("NATO") forces as they begin to expand their defenses. Wall Street Hasn't Caught on Yet To be sure, the company's stock has lagged the broader market so far this year. That's because the land war in Ukraine has shifted attention to companies that can profit from the conflict in the short term. Even Wall Street isn't showing a lot of love – yet. With so many new defense contracts totaling $45 billion under this company's belt, that's about to change. Remember that the U.S. – which has a defense budget that's bigger than the next 10 countries combined – NATO, and now Australia are ramping up defense spending significantly. And the company I have in mind will help shift the balance of power away from China and its bloc back toward the U.S. and its allies. One more thing to note: In addition to this company's growth potential, its stock currently offers shareholders a respectable 2.9% dividend. That beats the average of S&P 500 companies by more than 70%! To learn the name of this company and how to position yourself for maximum profits, make sure you're a "Pro" subscriber.   FOR TREND TRADER PRO READERS ONLY > [LEARN MORE]( < Cheers and Good Investing, [Michael Robinson] Michael Robinson Chief Investment Officer Trend Trader Daily   Copyright © Trend Trader Daily, All rights reserved. You signed up on []( Our mailing address is: Trend Trader Daily 1125 N. 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