AeroVironment's analyst price target has increased from $384 to $409, as analysts cite the company's expanding addressable market, accelerated revenue growth expectations, and successful portfolio diversification as key drivers for improved valuation.

Analyst Commentary

Analysts have weighed in on AeroVironment's recent performance and outlook, revealing both optimism and areas of caution regarding the company's future growth, execution, and valuation prospects.

• Bullish analysts are highlighting the company’s successful diversification beyond traditional unmanned aerial systems, emphasizing strategic contract wins and expansion into high-value defense programs.
• The addressable market opportunity is considered significant. Management has outlined pathways to reach over $75 billion in total opportunities by 2030, supporting robust long-term revenue expectations.
• Increasing manufacturing capacity and alignment with elevated global defense spending initiatives are seen as tailwinds that position AeroVironment for industry-leading growth.
• Recent investor events and product demonstrations, such as advanced counter-UAS systems, are viewed as validation of execution capabilities and growth ambition. These developments have prompted substantial upward revisions in price targets from several analysts.

• Bearish analysts remain mindful of potential challenges in execution as the company integrates acquisitions and scales up to meet heightened demand expectations.
• There is some caution regarding the visibility of future revenue. Backlog growth and FY26 performance will become focal points for investors evaluating near-term delivery on longer-term projections.
• While valuation is supported by growth prospects, some skepticism remains over whether current share prices fully reflect the underlying fundamentals, especially in a defense sector that is already seeing high investor interest.

What's in the News

• President Trump is preparing to ease restrictions on U.S. military drone exports, which could enable broader international sales of advanced drones and benefit manufacturers such as AeroVironment (Reuters).
• AeroVironment was selected to deliver the U.S. Army's Next-Generation Counter-UAS Missile (NGCM) and was awarded a $95.9 million contract for the Long-Range Kinetic Interceptor program.
• AeroVironment signed a Memorandum of Understanding with Korean Air to collaborate on uncrewed aircraft tailored for the Korean Defense market, supporting joint research and development as well as local production.
• The company announced a collaboration with OpenJAUS to integrate industry standards into its AV_Halo Command software, which will enable unified control of more than twenty uncrewed systems from multiple manufacturers.
• AeroVironment has received a nearly $240 million order for long-haul laser communications terminals that are set to be deployed on orbit, marking a significant advancement in space-based communications capabilities.

Valuation Changes

• Consensus Analyst Price Target has increased from $384 to $409, reflecting a higher market valuation outlook.
• Discount Rate has decreased slightly from 7.77% to 7.76%, indicating marginally improved perceived risk or capital costs.
• Revenue Growth projection has risen slightly from 42.06% to 42.15%, suggesting a modestly stronger outlook for future sales expansion.
• Net Profit Margin is up marginally from 9.49% to 9.51%, which underscores expectations for stable or better profitability.
• Future P/E ratio has increased from 97.7x to 103.6x, which signals increased investor willingness to pay for anticipated earnings growth.