William Blair analyst Louie DiPalma has maintained their bullish stance on AVAV stock, giving a Buy rating yesterday.
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Louie DiPalma has given his Buy rating due to a combination of factors related to AeroVironment’s strategic developments and growth potential. The company’s management expressed confidence in securing approval for direct commercial sales of the Switchblade, which could streamline allied transactions and potentially lead to more favorable terms compared to foreign military sales. Additionally, the scaling of Switchblade production, with a new facility in Utah set to double capacity, aligns with the Pentagon’s interest in significantly increasing missile production.
Furthermore, AeroVironment’s Red Dragon attack drone is anticipated to become a significant revenue driver due to its cost-effectiveness and extended range, despite less precise targeting compared to the Switchblade. The company’s collaboration with Sierra Nevada on the Golden Dome project and progress on the $1.4 billion SCAR contract, which involves delivering advanced satellite communication systems, also contribute to a positive outlook. While competition and funding constraints exist, management remains optimistic about the market’s capacity to accommodate multiple successful players.
In another report released yesterday, Raymond James also maintained a Buy rating on the stock with a $348.00 price target.
Based on the recent corporate insider activity of 42 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of AVAV in relation to earlier this year.