Trump Says 'There May Or May Not Be Regime Change In Iran,' But What Do Prediction Markets Say?

President Donald Trump addressed questions about potential military action against Iran on Friday, stating you “don’t want to, but sometimes you have to.”

The President stated he hadn’t made a decision on using military force and that there “may or may not be regime change in Iran.”

Trump made the remarks to reporters before leaving the White House for a trip to Texas.

Traders on Polymarket are pricing in a 78% chance of a U.S. strike by the end of year, up about eight percentage points from yesterday. The odds of a strike by the end of March are at 65%, up four percentage points. The market has crossed $470 million in volume.

Secretary of State Marco Rubio recently said that Iran possesses conventional weapons "solely designed to attack America.”

Defense contractors are positioned for a windfall as new reporting reveals the U.S. burned through defensive munitions at an alarming rate during the previous Iran flare-up, and faces critical stockpile shortages.

The U.S. fired as many as 150 THAAD missiles defending Israel during last year’s 12-day conflict, according to a regional military official. The U.S. has ordered fewer than 650 THAAD interceptors total since the system went operational around 2010.

The Navy burned through roughly 200 SM-2 and SM-6 missiles by January 2025 during operations against Houthi militants in the Red Sea. Admiral James Kilby told Congress in June 2025 that defensive munitions were being expended at an “alarming rate.”

Washington could “easily” expend a “whole year’s worth” of critical defensive munitions in just one or two days if Iran launches multiple large salvos, according to Stacie Pettyjohn, director of the defense program at the Center for a New American Security.

The Pentagon plans to spend $840 million on 37 THAAD interceptors in fiscal year 2026. For SM-3 missiles, which saw combat for the first time in April 2024, the U.S. will procure only 12 this fiscal year for $445 million.

Defense Stocks Could Benefit

The U.S. is seeking to “turbocharge” production of key munitions by striking multi-year agreements with major manufacturers.

Lockheed Martin Corporation (NYSE:LMT) manufactures THAAD missiles and recently announced plans to quadruple production capacity from 96 to 400 interceptors annually.

CEO Jim Taiclet said the company plans to raise capital spending to $5 billion in 2026. The stock is up 1.5% today, and 10% from the start of the year.

RTX Corporation (NYSE:RTX), through its Raytheon business, produces SM-3, SM-6, and Patriot missile systems.

The company recently secured a $1 billion contract for SM-3 Block missiles and a $333 million Navy contract for SM-6 production. The stock is up over 1% today, and 2.5% year to date.

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