AeroVironment, Inc. (AVAV) Stock Analysis

Why this analysis is different

• A sector-relative MoonshotScore — five pillars (business quality, financial safety, valuation, growth durability, momentum) re-ranked nightly against the full universe of US-listed common stocks.
• An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
• Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.

AeroVironment, Inc. (AVAV) Industrial Operations Profile

AeroVironment, Inc. is a leading provider of robotic systems and services, specializing in unmanned aircraft and tactical missile systems for defense and commercial applications. The company differentiates itself through its comprehensive portfolio of UAS solutions and established relationships with government and military clients.

What Is the Investment Thesis for AVAV?

AeroVironment presents a compelling investment case driven by the increasing demand for unmanned systems in defense and commercial sectors. The company's established relationships with the U.S. Department of Defense and international allies provide a stable revenue stream. Growth catalysts include expanding applications of UAS in agriculture, infrastructure inspection, and public safety. However, investors may want to evaluate the risks associated with government spending cycles and potential competition. The company's negative profit margin of -13.9% warrants monitoring, but its strong market position and technological expertise offer long-term growth potential. The company's beta of 1.26 suggests higher volatility compared to the overall market.

Based on FMP financials and quantitative analysis

AVAV Key Highlights

• AeroVironment operates in four segments: Unmanned Aircraft Systems (UAS), Tactical Missile System (TMS), Medium Unmanned Aircraft Systems (MUAS), and High Altitude Pseudo-Satellite Systems (HAPS).
• The company supplies UAS, TMS, unmanned ground vehicle, and related services primarily to organizations within the U.S. Department of Defense and to international allied governments.
• AeroVironment designs, engineers, tools, and manufactures unmanned aerial and aircraft systems, including airborne platforms, payloads and payload integration, ground control systems, and ground support equipment.
• AeroVironment offers small UAS products, including spare equipment, alternative payload modules, batteries, chargers, repair services, and customer support.
• The company develops high-altitude pseudo-satellite UAS systems.

Who Are AVAV's Competitors?

AVAV is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are AVAV's Key Strengths?

• Strong relationships with the U.S. Department of Defense.
• Technological leadership in small UAS.
• Diverse product portfolio.
• Established brand reputation.

What Are AVAV's Weaknesses?

• High dependence on government contracts.
• Negative profit margin.
• Limited presence in the commercial UAS market.
• Susceptibility to government spending cycles.

What Could Drive AVAV Stock Higher?

• Increasing global demand for unmanned systems in defense and commercial sectors.
• Expansion of UAS applications in agriculture, infrastructure inspection, and public safety.
• Potential new government contracts for UAS and TMS solutions.
• Development and deployment of high-altitude pseudo-satellite systems.
• Strategic partnerships and acquisitions to expand market reach and technological capabilities.

What Are the Key Risks for AVAV?

• Negative return on equity (-6.4%) — the business is not currently generating profit on shareholder capital.
• Weak fundamentals — a Piotroski F-Score of 3/9 flags soft profitability, leverage or efficiency.
• Dependence on government contracts and potential changes in spending priorities.
• Competition from larger defense contractors.
• Technological obsolescence and the need for continuous innovation.
• Economic downturns and their impact on defense spending.
• Negative profit margin and the need to improve operational efficiency.

What Are the Growth Opportunities for AVAV?

• Expansion in the Commercial UAS Market: AeroVironment can capitalize on the growing demand for UAS in commercial applications such as agriculture, infrastructure inspection, and delivery services. By developing specialized UAS solutions for specific commercial applications, the company can diversify its revenue streams and reduce its reliance on government contracts.
• Increased Adoption of Tactical Missile Systems: The demand for tactical missile systems is increasing due to evolving global security threats. AeroVironment's Switchblade loitering munition offers a cost-effective and precise solution for military operations. By expanding its TMS product line and targeting new international markets, the company can drive significant revenue growth in this segment. The tactical missile systems market is expected to grow steadily over the next decade.
• Development of High-Altitude Pseudo-Satellite Systems: AeroVironment's HAPS program represents a long-term growth opportunity. These systems can provide persistent surveillance and communication capabilities at a fraction of the cost of traditional satellites. By successfully developing and deploying HAPS, the company can tap into a new market with significant growth potential. The HAPS market is still in its early stages, but it is expected to grow rapidly as the technology matures.
• Strategic Partnerships and Acquisitions: AeroVironment can accelerate its growth by forming strategic partnerships and acquiring complementary businesses. By partnering with companies that have expertise in areas such as artificial intelligence, data analytics, and sensor technology, AeroVironment can enhance its UAS solutions and expand its market reach. Acquisitions can also provide access to new technologies and markets.
• International Expansion: AeroVironment has significant opportunities to expand its international presence. By targeting new international markets, the company can diversify its revenue streams and reduce its reliance on the U.S. Department of Defense. The international market for UAS and tactical missile systems is growing rapidly, offering significant growth potential for AeroVironment. The company can leverage its existing relationships with international allies to penetrate new markets.

What Opportunities Does AVAV Have?

• Expansion in the commercial UAS market.
• Increased adoption of tactical missile systems.
• Development of high-altitude pseudo-satellite systems.
• Strategic partnerships and acquisitions.

What Threats Does AVAV Face?

• Competition from larger defense contractors.
• Technological obsolescence.
• Changes in government spending priorities.
• Economic downturns.

What Are AVAV's Competitive Advantages?

• Established relationships with the U.S. Department of Defense and international allies.
• Technological expertise in unmanned systems.
• Comprehensive portfolio of UAS and TMS solutions.
• Strong brand reputation in the aerospace and defense industry.

What Does AVAV Do?

AeroVironment, Inc., founded in 1971, has evolved into a prominent player in the aerospace and defense industry, focusing on robotic systems and related services. The company operates through four segments: Unmanned Aircraft Systems (UAS), Tactical Missile System (TMS), Medium Unmanned Aircraft Systems (MUAS), and High Altitude Pseudo-Satellite Systems (HAPS). AeroVironment's core business involves designing, developing, producing, and supporting a range of unmanned systems for government agencies and businesses worldwide. Its product portfolio includes small UAS like the Raven, Puma, and Wasp, which are used for reconnaissance, surveillance, and target acquisition. The company also offers tactical missile systems such as the Switchblade, a loitering munition. AeroVironment's solutions are primarily sold to the U.S. Department of Defense and international allied governments. The company's headquarters are located in Arlington, Virginia, and it serves a global market with its advanced technological solutions.

What Products and Services Does AVAV Offer?

• Designs and manufactures unmanned aircraft systems (UAS).
• Develops tactical missile systems (TMS).
• Produces unmanned ground vehicles.
• Provides related services to government agencies and businesses.
• Offers small UAS products, including spare equipment and support.
• Develops high-altitude pseudo-satellite UAS systems.
• Supplies UAS and TMS to the U.S. Department of Defense and international allies.

How Does AVAV Make Money?

• Sells unmanned aircraft systems (UAS) to government and commercial customers.
• Provides maintenance, repair, and support services for its UAS products.
• Generates revenue from the sale of tactical missile systems (TMS).
• Offers engineering and development services for custom UAS solutions.

What Industry Does AVAV Operate In?

The aerospace and defense industry is experiencing growth driven by increasing global security concerns and technological advancements in unmanned systems. The market for UAS is expanding beyond military applications into commercial sectors such as agriculture, infrastructure inspection, and delivery services. AeroVironment competes with companies like ESLT: Elbit Systems Ltd. and CW: Curtiss-Wright Corporation, but differentiates itself through its focus on small UAS and tactical missile systems. The industry is characterized by high barriers to entry due to stringent regulatory requirements and the need for advanced technological expertise.

Who Are AVAV's Key Customers?

• U.S. Department of Defense
• International allied governments
• Commercial businesses in agriculture, infrastructure inspection, and public safety

Company Profile

AeroVironment, Inc. operates in the Aerospace & Defense industry within the Industrials sector. It is headquartered in Arlington, US. The company is led by CEO Wahid Nawabi. AVAV has traded publicly since 2007.

ROE -6%Key Financial Metrics

Return on equity for AeroVironment, Inc. stands at -6.4%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is -4.1%, showing how much profit it generates from its asset base. Its free cash flow yield is -2.3%, a gauge of the cash the business throws off relative to its market value. A current ratio of 5.51 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is -2.7%, the inverse of the P/E and a quick read on earnings relative to price.

AVAV Valuation & Market Position

With a $7.22B market cap, AeroVironment, Inc. sits in the mid-cap segment of the market. Relative to its peer group, AVAV's quantitative score of 29/100 is below the peer average of 65/100.

Quarterly Financial Performance: AeroVironment, Inc.

Revenue for AeroVironment, Inc. came in at $641.6M during Q2 2026, a 57.2% improvement versus the preceding quarter. The company recorded a net loss of $24.1M, with diluted EPS of $1.25. Quarter-over-quarter revenue has been mixed, typical for a mid-cap company operating in Industrials. Across the four most recent quarters, AVAV averaged $-1.16 in diluted EPS.

F-Score 3/9Financial Health

AeroVironment, Inc.'s Piotroski F-Score is 3/9, a 9-point checklist of profitability, leverage and efficiency — flagging fundamental weakness worth scrutiny. Its Altman Z-Score of 3.83 places it in the safe zone, indicating low near-term bankruptcy risk.

FY2026 estForward Outlook

Wall Street analysts project AeroVironment, Inc. revenue of about $1.89B for fiscal 2026, with EPS near $2.87. The estimate reflects 13 contributing analysts.

Net buyingInsider Activity

Over the past six months, AeroVironment, Inc. insiders filed 30 SEC Form 4 transactions — 2 sales and 28 purchases. On net that is roughly 43K shares acquired (about $329K) — insiders putting money in tends to read as conviction.

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Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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