One high-flying UK growth share has again caught my eye. I’ve been tracking its progress for a year, looking for an opportunity to buy it at a more sensible valuation. It’s just fallen 18% in a month. Is this it?

The stock’s FTSE 100 defence specialist Babcock International Group (LSE: BAB). Its shares have gone great guns in recent years, along with almost every other weapons manufacturer, as Western countries rearm. Suddenly they’re falling. Instinctively, I checked defence blue-chip BAE Systems (LSE: BA.), and found it was down 15% in the last month.

Why are defence stocks falling?

I then looked up Rolls-Royce (LSE: RR). This is primarily a civil aerospace play, but defence contributes around 25% of revenues. Rolls-Royce shares are down a more modest 4.6% in the last month.

Markets have been jumpy, but defence has been jumpier the most. I suspect there’s a lot of profit-taking going on. Many investors will be sitting on huge gains. Over five years, Babcock shares are up 167%, BAE is up 240% and Rolls-Royce an astonishing 1,201%.

Valuations look stretched. Even after that sharp drop, Babcock trades on a price-to-earnings ratio of 23.1. BAE Systems is pricier at 25.6. Rolls-Royce is hugely expensive at 48.4. Yet, ironically, it’s fallen least.

Investors buy these three for growth rather than income. They do pay dividends but the opening yields are disappointing. Today, Babcock has a trailing yield of 0.78%. BAE yields 1.91%, while Rolls-Royce just 0.65%.

The results remain strong

Recent share price falls haven’t been caused by collapsing profits. Babcock’s latest full-year results showed underlying operating profit up 19% to £433m, on revenue of £5.2bn. Its contract backlog stood at £9.8bn.

BAE reported half-year sales up 9% to £15.8bn, while underlying earnings before interest and tax rose 11% to £1.7bn. Its order backlog hit £84bn.

Rolls-Royce reported a 46% increase in first-half underlying operating profit to £2.5bn, with defence revenue rising 17% to £2.5bn. Its defence order backlog stood at £17.5bn.

There are risks, of course. Defence spending can change with politics and government budgets, while these businesses face the usual concerns around costs, supply chains and executing huge contracts. Babcock just incurred a £140m charge relating to its Type 31 frigate programme, for example.

So what about the outlook?

Broker forecasts remain remarkably positive. The consensus one-year target for Babcock is 1,409p. If correct, that suggests 46% potential growth from today’s 965p. BAE has a 2,333p target, implying 23% growth, while Rolls-Royce has a 1,757p target, up 21% from today.

Some of the forecasts may have been made before the recent sell-off, and shouldn’t be treated as gospel. Babcock’s the stock that interests me most. It’s also the one I don’t own. BAE looks well worth considering too.

Rolls-Royce remains an outstanding business, but at 48.4 times earnings I want a much bigger dip before considering it. There are other FTSE 100 growth opportunities that I’ve got my eye on…

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Harvey Jones owns shares in BAE Systems and Rolls-Royce.