AeroVironment (AVAV) AI Stock Analysis

• Market Cap: $13.09B
• Dividend Yield: N/A
• Average Volume (3M): 1.32M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.76
• Revenue Growth: 79.89%
• EPS Growth: -171.81%
• Country: US
• Employees: 1,403
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 0.44
• Shares Outstanding: 49,925,877
• 10 Day Avg. Volume: 893,391
• 30 Day Avg. Volume: 1,319,502
• PEG Ratio: -3.38
• Price to Book (P/B): 4.79
• Price to Sales (P/S): 5.17
• P/FCF Ratio: -175.91
• Enterprise Value/Market Cap: 1.00
• Enterprise Value/Revenue: 9.54
• Enterprise Value/Gross Profit: 37.86
• Enterprise Value/Ebitda: 113.64
• 1Y Price Target: $377.92
• Price Target Upside: 45.57% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 14
• EPS Forecast (FY): 3.42
• Revenue Forecast (FY): $1.99B

• Rating: 61 Neutral
• Price Target: $274.00 ▲(5.54% Upside)
• Action: Reiterated Date: 01/21/26
• Date: Action: Reiterated 01/21/26

Overall score reflects a balance between weaker financial performance (losses, negative operating cash flow, and revenue contraction) and stronger forward-looking signals from the earnings call (raised guidance, record bookings/awards, strong backlog visibility) plus constructive price trend and momentum. Valuation is a notable drag due to the negative P/E and no provided dividend yield, while corporate events are mixed with a stop-work order offset by facility expansion.

Positive Factors

Backlog and Contract Awards

Large, recent contract awards and a multi-billion backlog provide durable revenue visibility across quarters, underpinning sales cadence and easing planning for production and staffing. High funded/unfunded backlog coverage (93%) supports multi-period revenue targets and reduces short-term demand risk.

Manufacturing Capacity Expansion

Material facility expansion establishes scalable production capacity to meet rising defense demand for Switchblade systems. Expanded footprint reduces future supply constraints, supports higher unit volumes and product maturity, and enhances the company's ability to capture large program awards long-term.

Conservative Leverage

A low debt-to-equity ratio preserves financial flexibility to invest in R&D, fund integration of acquisitions, and absorb program timing variability. Conservative leverage reduces refinancing risk and supports competitive bidding on multi-year defense contracts without excessive interest burden.

Negative Factors

Operating Cash Flow Deficit

Sustained negative operating cash flow is a structural concern: it limits self-funding for working capital, capital expenditure and R&D, and increases dependence on external financing. Absent steady positive OCF, margin improvements and backlog monetization may be harder to sustain over time.

Revenue and Margin Deterioration

Sharp revenue contraction and material gross margin decline indicate weaker core profitability and potential product-mix shifts toward lower-margin services or early-stage products. This constrains long-term earnings power and the ability to fund strategic investments without restoring higher-margin sales.

Program Execution & Contract Risk

A stop-work order and move to firm-fixed-price terms transfer greater cost and schedule risk to the company. Such contractual shifts can compress margins, delay revenue recognition, and require program re-pricing or additional reserves, creating durable execution and profitability risks on government programs.

AeroVironment Business Overview & Revenue Model

Company Description

AeroVironment, Inc. designs, develops, produces, delivers, and supports a portfolio of robotic systems and related services for government agencies and businesses in the United States and internationally. It operates through 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. It also designs, engineers, tools, and manufactures unmanned aerial and aircraft systems, including airborne platforms, payloads and payload integration, ground control systems, and ground support equipment and other items and services related to unmanned aircraft systems. In addition, the company offers small UAS products, including spare equipment, alternative payload modules, batteries, chargers, repair services, and customer support, as well as multiple aircraft, hand-held ground control system, and spare parts and accessories. Further, it develops high-altitude pseudo-satellite UAS systems. The company was incorporated in 1971 and is headquartered in Arlington, Virginia.

How the Company Makes Money

AeroVironment generates revenue through several key streams, primarily from the sale of its UAV systems and related services to military and government customers. The company benefits from long-term contracts and recurring revenue from maintenance and support services. Additionally, AeroVironment has a growing presence in the commercial sector, particularly through its EV charging solutions, which are sold to businesses and municipalities. Strategic partnerships with defense contractors and government agencies enhance its revenue potential, while ongoing investments in research and development ensure innovative product offerings that meet evolving market demands.

AeroVironment Financial Statement Overview

Summary

Mixed fundamentals: the balance sheet is relatively conservative (debt-to-equity 0.19), but profitability and cash generation are weak (net margin -4.14% TTM, negative ROE -2.55% TTM, operating cash flow -$194.8M TTM) alongside a sharp revenue decline (-42% TTM) and lower gross margin (30.99% TTM vs 39.35% prior).

Income Statement

AeroVironment's income statement shows a challenging period with a negative net profit margin of -4.14% TTM, indicating losses. The gross profit margin has decreased to 30.99% TTM from 39.35% in the previous annual report, reflecting reduced profitability. Revenue growth has also declined by 42% TTM, suggesting significant revenue contraction. These factors highlight a need for strategic improvements to regain profitability.

Balance Sheet

The balance sheet reflects a stable financial structure with a low debt-to-equity ratio of 0.19 TTM, indicating conservative leverage. However, the return on equity is negative at -2.55% TTM, pointing to inefficiencies in generating returns from equity. The equity ratio remains strong, suggesting a solid capital base, but the company needs to improve its return metrics.

Cash Flow

Cash flow analysis reveals challenges with negative operating cash flow of -$194.8 million TTM and a free cash flow to net income ratio of 1.19, indicating cash flow issues despite net losses. Free cash flow growth is positive at 13.19% TTM, showing some improvement, but overall cash flow management requires attention to support operations and growth.

Breakdown	TTM	Apr 2025	Apr 2024	Apr 2023	Apr 2022	Apr 2021
Income Statement
Total Revenue	1.37B	820.63M	716.72M	540.54M	445.73M	394.91M
Gross Profit	344.96M	322.94M	283.93M	173.51M	141.24M	164.56M
EBITDA	114.95M	104.39M	109.45M	61.20M	51.88M	69.54M
Net Income	-69.56M	43.62M	59.67M	-176.21M	-4.19M	23.33M
Balance Sheet
Total Assets	5.64B	1.12B	1.02B	824.58M	914.20M	928.57M
Cash, Cash Equivalents and Short-Term Investments	588.48M	40.86M	73.30M	132.86M	101.95M	180.71M
Total Debt	825.93M	64.29M	59.68M	162.82M	216.57M	222.77M
Total Liabilities	1.22B	234.06M	193.12M	273.61M	305.99M	316.46M
Stockholders Equity	4.42B	886.51M	822.75M	550.97M	607.97M	612.09M
Cash Flow
Free Cash Flow	-207.21M	-24.13M	-9.19M	-3.47M	-31.91M	75.27M
Operating Cash Flow	-194.84M	-1.32M	15.29M	11.40M	-9.62M	86.53M
Investing Cash Flow	-1.17B	-28.49M	-51.71M	-7.00M	-52.29M	-378.77M
Financing Cash Flow	1.66B	-2.86M	-22.85M	50.83M	-16.61M	194.16M

AeroVironment Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 259.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVAV, the sentiment is Negative. The current price of 259.62 is below the 20-day moving average (MA) of 262.58, below the 50-day MA of 283.36, and below the 200-day MA of 271.84, indicating a bearish trend. The MACD of -9.50 indicates Negative momentum. The RSI at 45.47 is Neutral, neither overbought nor oversold. The STOCH value of 48.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AVAV.

AeroVironment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DRS	73 Outperform	$11.66B	42.36	10.52%	1.04%	12.27%	33.16%
KRMN	67 Neutral	$11.06B	974.77	―	―	―	―
SARO	64 Neutral	$10.65B	55.88	11.01%	―	17.79%	815.80%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AVAV	61 Neutral	$13.09B	-203.52	-2.64%	―	79.89%	-171.81%
KTOS	55 Neutral	$15.45B	670.44	1.31%	―	14.00%	23.78%
MRCY	55 Neutral	$5.33B	-172.79	-2.08%	―	8.63%	72.72%

AeroVironment Corporate Events

AeroVironment Announces CFO Retirement and Transition Plan

On February 18, 2026, AeroVironment Executive Vice President and Chief Financial Officer Kevin McDonnell notified the company of his decision to retire effective July 31, 2026, and on February 20, 2026, he entered into a retirement agreement setting the terms of his departure. Under the agreement, McDonnell will remain CFO until a successor starts or until his retirement date, then, if replaced earlier, continue in a non-officer role to support an orderly transition while receiving his current salary, a full fiscal 2026 target bonus, certain COBRA-related payments and continued vesting of existing equity awards through his retirement, in return for a general release of claims and reaffirmation of confidentiality obligations.

The planned retirement and structured transition arrangement are designed to maintain financial leadership stability at AeroVironment while the board recruits a new CFO, limiting disruption to ongoing operations and preserving continuity for investors and other stakeholders.

The most recent analyst rating on (AVAV) stock is a Hold with a $288.00 price target. To see the full list of analyst forecasts on AeroVironment stock, see the AVAV Stock Forecast page.

AeroVironment Faces Stop Work Order, Renegotiates SCAR Deal

On January 16, 2026, the U.S. Government, in mutual agreement with AeroVironment, issued a stop work order on the company’s Other Transaction Agreement for delivery of BADGER phased array antenna systems under the Satellite Communication Augmentation Resource (SCAR) program, pausing current work while the parties negotiate an amended agreement aligned with new program requirements. The revised arrangement is expected to shift to a firm-fixed-price structure, signaling a move toward tighter cost controls and clearer risk allocation, and AeroVironment indicated it expects to continue supplying capabilities and products for SCAR, suggesting the program remains strategically important despite the interim disruption to contract execution.

The most recent analyst rating on (AVAV) stock is a Hold with a $366.00 price target. To see the full list of analyst forecasts on AeroVironment stock, see the AVAV Stock Forecast page.

AeroVironment Expands Operations with Long-Term Utah Facility Lease

On December 18, 2025, AeroVironment, Inc. signed a long-term lease for approximately 130,733 square feet of space at 4387 West 2100 South in West Valley City, Utah, with base monthly rent starting at $146,420.96 and escalating through the 126-month term, and with the company also responsible for a proportionate share of operating expenses such as property taxes. The lease includes two options to extend the term for additional five-year periods at then-current market rents (but not less than the final month’s base rent), indicating a significant and potentially enduring expansion of AeroVironment’s operational footprint that could support future growth and capacity needs in its defense and unmanned systems business.

The most recent analyst rating on (AVAV) stock is a Buy with a $285.00 price target. To see the full list of analyst forecasts on AeroVironment stock, see the AVAV Stock Forecast page.

AeroVironment Reports Record Q2 Revenue Growth

AeroVironment, Inc. reported record revenue of $472.5 million for the second quarter of fiscal 2026, marking a 151% increase year-over-year, largely driven by the acquisition of BlueHalo. Despite the revenue growth, the company experienced a net loss of $17.1 million due to increased intangible amortization and acquisition-related expenses. The company’s backlog reached $1.1 billion, reflecting strong bookings and a book-to-bill ratio of 2.9, positioning AeroVironment as a key player in the evolving defense sector.

The most recent analyst rating on (AVAV) stock is a Buy with a $400.00 price target. To see the full list of analyst forecasts on AeroVironment stock, see the AVAV Stock Forecast page.