In a report released yesterday, Andre Madrid from BTIG reiterated a Buy rating on AeroVironment, with a price target of $415.00.
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Andre Madrid has given his Buy rating due to a combination of factors, primarily driven by AeroVironment’s recent $874.3 million contract with the US Army. This contract, which includes the supply of various unmanned aircraft systems and related services, is expected to significantly bolster AeroVironment’s revenue over the coming years. The contract highlights the strength and growth potential within the company’s Autonomous Systems segment.
Moreover, the contract is anticipated to be margin accretive, with small unmanned aircraft systems typically offering higher margins. Additionally, foreign military sales, which are a component of this contract, generally yield better margins than domestic sales. With Puma sales already contributing significantly to the company’s revenue, this contract further solidifies AeroVironment’s position in the market, justifying the Buy rating.
Based on the recent corporate insider activity of 46 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.