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AeroVironment (AVAV)
NASDAQ:AVAV
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AeroVironment
(NASDAQ:AVAV)
59Neutral
Positive Factors
Backlog Growth
Funded backlog has increased by 65% year-over-year, providing a strong foundation for future revenue growth.
International Demand
AeroVironment was selected by the Danish Defense Acquisition and Logistics Organization to supply its JUMP 20 mUAS to the Danish Armed Forces, marking a significant international contract win.
Negative Factors
Operational Challenges
Operational challenges in Q3 resulted in a decline in revenue, overshadowing positive future outlooks.
AeroVironment (AVAV) vs. S&P 500 (SPY)
Market Cap
$3.50B
Dividend YieldN/A
Average Volume (3M)537.24K
Price to Earnings (P/E)106.1
Beta (1Y)0.86
Revenue Growth5.21%
EPS GrowthN/A
CountryUS
Employees1,428
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)1.17
Shares Outstanding28,218,842
10 Day Avg. Volume824,840
30 Day Avg. Volume537,242
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)4.69
Price to Cash Flow (P/CF)-33.80
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$187.00Price Target Upside50.81% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
AeroVironment Business Overview & Revenue Model
Company DescriptionAeroVironment, Inc. engages in the design, development, production, support, and operation of unmanned aircraft systems and electric transportation solutions. The company was founded in July 1971 by Paul B. MacCready, Jr. and is headquartered in Monrovia, CA.
How the Company Makes MoneyAeroVironment generates revenue primarily through the sale of its unmanned aircraft systems and related services to government agencies, defense contractors, and commercial clients. Key revenue streams include contracts with the U.S. Department of Defense and allied nations, which account for a significant portion of its earnings. The company also leverages its proprietary technology to offer data analytics and integration services, expanding its market reach into sectors such as agriculture, energy, and infrastructure. Strategic partnerships with other defense and technology firms help AeroVironment enhance its product offerings and access new markets, further contributing to its financial performance.
AeroVironment Financial Statement Overview
Summary
AeroVironment shows strong revenue growth and a robust balance sheet with low leverage, which positions it well in the industry. However, profitability margins and cash flow generation are areas needing improvement for sustained financial health.Income Statement
AeroVironment has demonstrated solid revenue growth with a TTM (Trailing-Twelve-Months) revenue of $714.67M compared to $445.73M in 2022. The gross profit margin improved over time, indicating efficient cost management, but the net profit margin shows volatility, with recent margins at 4.62% in TTM. The EBIT and EBITDA margins have seen fluctuations, with TTM margins at about 4.63% and 7.03%, respectively. Overall, the company exhibits growth potential with some profitability challenges.75
Positive
Balance Sheet
AeroVironment boasts a strong balance sheet with a high equity ratio of approximately 82.1% in TTM, reflecting financial stability. The debt-to-equity ratio is low at 0.04, indicating low leverage risk. However, the return on equity (ROE) is modest at 3.83%, suggesting room for improving shareholder returns. The company's solid equity position strengthens its financial footing.80
Positive
Cash Flow
The cash flow statement reveals challenges in generating free cash flow, with a negative free cash flow of $-21.81M in TTM. While operating cash flow was negative at $-12.73M, the ratio of operating cash flow to net income suggests inefficiencies in cash generation. The company needs to improve its cash generation capabilities to enhance financial flexibility.65
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 75.32M | 716.72M | 540.54M | 445.73M | 394.91M | 367.30M | Gross Profit |
| 30.39M | 283.29M | 173.51M | 141.24M | 164.56M | 153.10M | EBIT |
| 7.84M | 71.82M | -22.99M | -20.20M | 43.31M | 47.13M | EBITDA |
| 9.79M | 103.20M | -79.08M | 43.35M | 54.24M | 57.02M | Net Income Common Stockholders |
| 8.37M | 59.67M | -173.71M | -8.77M | 33.83M | 41.07M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 47.00M | 73.30M | 132.86M | 101.95M | 180.71M | 302.65M | Total Assets |
| 1.05B | 1.02B | 824.58M | 914.20M | 928.57M | 584.95M | Total Debt |
| 59.19M | 59.68M | 162.82M | 216.57M | 222.77M | 10.21M | Net Debt |
| 12.19M | -13.62M | 29.96M | 139.34M | 74.03M | -244.93M | Total Liabilities |
| 187.09M | 193.12M | 273.61M | 305.99M | 316.46M | 75.05M | Stockholders Equity |
| 861.05M | 822.75M | 550.97M | 607.97M | 612.09M | 509.90M |
| Cash Flow | Free Cash Flow | ||||
| 1.51M | -9.19M | -3.47M | -31.91M | 75.27M | 13.88M | Operating Cash Flow |
| 4.18M | 15.29M | 11.40M | -9.62M | 86.53M | 25.10M | Investing Cash Flow |
| -5.96M | -51.71M | -7.00M | -52.29M | -378.77M | 59.17M | Financing Cash Flow |
| -101.00K | -22.85M | 50.83M | -16.61M | 194.16M | -1.83M |
AeroVironment Technical Analysis
Negative
124.00
Price Trends
161.84
Negative
179.07
Negative
183.77
Negative
Market Momentum
-11.00
Positive
20.96
Positive
34.70
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 124 is below the 20-day moving average (MA) of 149.36, below the 50-day MA of 161.84, and below the 200-day MA of 183.77, indicating a bearish trend. The MACD of -11.00 indicates Positive momentum. The RSI at 20.96 is Positive, neither overbought nor oversold. The STOCH value of 34.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AVAV.
AeroVironment Risk Analysis
AeroVironment disclosed 77 risk factors in its most recent earnings report. AeroVironment reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
AeroVironment Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $71.53B | 17.48 | 27.75% | 1.62% | 4.44% | 110.33% | |
75 Outperform | $73.52B | 19.92 | 17.44% | 2.15% | 12.88% | 13.78% | |
74 Outperform | $110.37B | 21.48 | 81.04% | 2.66% | 5.14% | -19.14% | |
62 Neutral | $8.16B | 12.85 | 0.64% | 3.04% | 3.83% | -15.83% | |
59 Neutral | $3.50B | 106.07 | 3.94% | ― | 5.21% | ― | |
52 Neutral | $4.44B | 272.61 | 1.40% | ― | 9.57% | ― | |
37 Underperform | $111.12B | ― | -162.23% | ― | -14.49% | -399.90% |
* Industrials Sector Average
Performance Comparison
AVAV
AeroVironment
121.53
-39.68
-24.61%
BA
Boeing
158.80
-23.55
-12.91%
GD
General Dynamics
260.01
-9.89
-3.66%
KTOS
Kratos Defense
29.60
12.06
68.76%
LMT
Lockheed Martin
461.50
38.01
8.98%
NOC
Northrop Grumman
475.10
24.62
5.47%
AeroVironment Earnings Call Summary
Earnings Call Date: Mar 4, 2025 | % Change Since: -12.61% | Next Earnings Date: Jul 1, 2025
Earnings Call Sentiment Neutral
AeroVironment reported a mixed quarter with record backlog and significant contract wins, but faced operational challenges and revenue shortfalls due to external factors like LA windstorms and stop work orders. Despite these setbacks, the company remains confident in its long-term growth prospects and is making strategic investments to support future expansion.Highlights
Record Backlog and Large Contract Wins
AeroVironment reported a record backlog of $764 million, driven by large contract wins with the US Army's LASSO, US DOD's replicator, and the Danish Ministry of Defense.
Significant Growth in Loitering Munitions Segment (LMS)
The LMS segment recorded a 46% increase in revenue year-over-year, reaching $83.9 million, with more than 70% of this revenue coming from Switchblade 600.
BlueHalo Acquisition Progress
Significant progress on the BlueHalo acquisition, with key regulatory approvals secured and a shareholder vote scheduled for April 1, 2025. This acquisition is expected to enhance AeroVironment's technology and capabilities, especially in space technologies, counter-UAS, and electronic warfare.
Expansion of Manufacturing Capacity
AeroVironment is aggressively expanding manufacturing capacity with a new Switchblade production facility in Utah, set to double production throughput and support over $1 billion in annual LMS revenue by the end of fiscal year 2027.
Strong Future Outlook
Despite near-term challenges, AeroVironment expects more than 10% revenue growth and aims for $1 billion in orders for fiscal year 2025, with accelerating growth projected for fiscal year 2026.
Lowlights
Revenue and Profitability Below Expectations
Revenue for the third quarter was $167.6 million, a decrease of 10% compared to the previous year, primarily due to production disruptions caused by unprecedented LA windstorms.
Lowered Fiscal Year 2025 Guidance
Guidance for fiscal year 2025 has been lowered, with expected revenues of $780 million to $795 million, adjusted EBITDA of $135 million to $142 million, and non-GAAP EPS of $2.92 to $3.13 per share.
Stop Work Orders and Tariffs Impact
Recent stop work orders tied to four foreign military sales contracts, representing about $13 million in orders, will impact Q4 deliveries. Additionally, the US government paused military aid to Ukraine and implemented new tariffs, affecting AeroVironment's operations.
Challenges in Uncrewed Systems Segment (UXS)
The UXS segment saw a 44% decline in revenue, primarily due to a decrease in Ukraine-related revenue. This segment is in a transition year, shifting away from Ukraine-related revenue to other growth opportunities.
Company Guidance
During AeroVironment's fiscal year 2025 third-quarter earnings call, the company provided updated guidance reflecting several operational challenges and strategic developments. Revenue for the quarter was $167.6 million, a decrease from $186.6 million in the same period last year, primarily due to disruptions from unprecedented Los Angeles windstorms and fires. The loitering munitions segment, however, saw a 46% revenue increase to $83.9 million, driven by strong demand for the Switchblade 600. Despite these gains, overall adjusted EBITDA fell to $21.8 million from $28.8 million the previous year. The company lowered its full-year revenue guidance to a range of $780 million to $795 million, with adjusted EBITDA forecasts now set between $135 million and $142 million. AeroVironment remains optimistic about future growth, citing a record backlog of $764 million and ongoing strategic investments, including the anticipated integration of BlueHalo, which is expected to enhance capabilities and market opportunities across multiple defense technology domains.AeroVironment Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
AeroVironment Reports Record Backlog Amid Revenue Decline
Neutral
Mar 4, 2025
AeroVironment reported its fiscal 2025 third-quarter results, highlighting a record funded backlog of $763.5 million and a 10% year-over-year revenue decrease to $167.6 million. The company faced challenges such as high winds and fires in Southern California, impacting its operations. Despite these hurdles, AeroVironment made progress in its long-term growth strategy, including record orders for Switchblade and Jump-20, and announced a new Utah manufacturing facility to increase capacity. The company also advanced its acquisition of BlueHalo, expected to close in the second quarter of 2025. AeroVironment anticipates a strong fiscal year 2025 with record fourth-quarter revenue, despite transitioning away from Ukraine demand.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.