With Donald Trump’s US election victory catching many off guard, investors have rushed to reposition their portfolios over the last week. The defence and financial sectors have surged higher on the back of Trump’s policies and both BAE Systems (LSE: BA) and Aldermore Group (LSE: ALD) have performed particularly well. Is it too late to jump on-board these stocks now or is there more to come from these FTSE 350 fast movers?

BAE Systems

Trump’s pledge to increase US defence spending and to stop “subsidising” NATO, could potentially provide material upside to the European defence sector, and it doesn’t surprise me that shares in BAE Systems have risen around 10% since Trump’s election win.

But at a share price of 600p and a P/E ratio of 20 times FY2015 earnings, is the stock now fully valued?

Several brokers believe there’s more to come from BAE Systems with analysts at Société Générale, JP Morgan and Goldman Sachs setting price targets of 650p, 675p and 697p respectively for the defence giant. And with earnings forecast to grow from 30p in FY2015 to 40p for FY2016, BAE Systems’ forward-looking P/E ratio of 15 times earnings isn’t overly demanding. The company has traded at more expensive multiples than this in recent periods in which US defence spending was set to increase, suggesting that the stock’s upward momentum could continue.

On the other hand, one indicator suggesting the stock is no longer cheap is the company’s dividend yield. With BAE Systems paying dividends of 21p per share last year and analysts not expecting the payout to rise this year, the company’s current and forecast dividend yield is now only 3.5%. Given the fact there’s been plenty of opportunities to buy the stock with a yield of between 4%-4.5% in recent years, the current yield looks a little underwhelming in my opinion.

However with sentiment towards the defence sector improving on the back of Trump’s victory, I’m cautiously optimistic that BAE Systems’ share price has further to run.

Aldermore Group

One company in which I’m confident that it’s not too late to buy is challenger bank Aldermore Group.

Aldermore released an upbeat trading statement for the first nine months of 2016 last week, and reported a net loans increase of 15% to £7.1bn, with a 24% increase in new lending to mortgage customers. The fast-growing challenger bank noted that its net interest margin was stable in the quarter, and also reported a CET1 capital position of 11.5%, beating many analyst’s expectations. Management stated that it had seen no changes in customer demand for loans and that its pipeline remained “strong.”

The combination of the positive trading statement and an improvement in sentiment across the financial sector since Trump’s win has seen Aldermore shares climb around 10% in the last week, and the stock is now up almost 100% from its post-Brexit low of 102p. While this is no doubt a strong performance in just over four months, I believe Aldermore is still trading too cheaply, with the bank’s forward looking P/E ratio a low 8.

Clearly there’s still plenty of Brexit uncertainty surrounding the UK financial sector right now, however in my opinion, the market is discounting the prospects of the challenger banks too heavily.

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Edward Sheldon owns shares in BAE Systems and Aldermore Group. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.