** Brokerage Barclays says defense cos valuations are "intriguing," and cuts PTs on major cos citing potential budget and DOGE risks

** President-elect Donald Trump, gearing up for his second term, announced the formation of the Department of Government Efficiency (DOGE), a proposed advisory commission to be led by businessmen Elon Musk and Vivek Ramaswamy

** Barclays cuts PTs of L3Harris Technologies LHX.N to $255 from $290, Lockheed Martin Corp LMT.N to $515 from $565 and General Dynamics GD.N to $305 from $330

** Shares of LMT and LHX down ~1% in early morning trading

** Brokerage says that without accelerated budget growth, the defense sector's potential may be unattainable

** "For 2025, we forecast aero EPS outgrowing at mid-to-high teens on average while defense EPS under-grows at HSD on average" - Barclays

** Brokerage, however, believes there's potential for profit margins to improve after they've been negatively affected in recent years by inflation and an "unfavorable mix"

** In 2024, LMT gained ~7% and GD rose ~2%, while LHX was down ~0.2%

(Reporting by Rupali Chaudhary in Bengaluru)

((Rupali.Chaudhary@thomsonreuters.com))