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AeroVironment: Defense Stock Soars Amidst Order Surge
13 Dec
Summary
- AeroVironment's stock rallied 60% year-to-date despite a recent 40% correction.
- The company holds a $1.1 billion funded and $3.0 billion unfunded order backlog.
- A recent $874 million contract bolsters unmanned and counter-UAS system orders.
AeroVironment (AVAV) has experienced a substantial 60% year-to-date stock increase, driven by positive business fundamentals. While the stock saw a 40% dip from its peak due to valuation concerns and an earnings miss, the underlying order intake remains robust. The company, a defense technology firm with diverse capabilities, is projected to reach $2 billion in revenue for FY 2026.
Key to its growth is a substantial order backlog, standing at $1.1 billion funded and $3.0 billion unfunded as of November 2025. This provides significant revenue visibility. Further bolstering its order book, AeroVironment secured a $874 million contract from the U.S. Army Contracting Command on December 8, 2025, for unmanned aerial and counter-UAS systems.
The company's strategic acquisitions, such as BlueHalo, are expanding its product portfolio and opening new market opportunities, including space-based communications. Despite recent price volatility, AeroVironment's sustained order intake and innovation suggest a continued strong growth trajectory.
