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Investing.com - Raymond (NSE:RYMD) James raised its price target on AeroVironment (NASDAQ:AVAV) to $225.00 from $200.00 on Wednesday, while maintaining a Strong Buy rating following the company’s fiscal year 2025 earnings report. The stock, currently trading at $241.46, has shown remarkable momentum with a market capitalization of $11 billion and is trading near its 52-week high. According to InvestingPro analysis, the company’s current P/E ratio of 204.6x suggests a premium valuation.
The research firm cited AeroVironment’s strong close to FY25 and its first quarterly results following the BlueHalo merger as key factors in the decision. Raymond James believes the company is "extremely well positioned" to counter current global threats and benefit from the administration’s preference toward non-traditional defense companies. InvestingPro data reveals strong financial health metrics and revenue growth of 14.5% in the last twelve months, with 14 additional exclusive insights available to subscribers.
Raymond James projects AeroVironment will grow at more than 15% compound annual growth rate (CAGR) over the next three years and transition from episodic, conflict-driven product sales to more predictable programs of record. The firm’s forecast exceeds current Street expectations for the next several quarters.
The research firm highlighted AeroVironment’s portfolio as particularly well-suited to meet "Golden Dome demand" with its directed energy, counter-unmanned aircraft systems (C-UAS), and space products. Raymond James planned to host AeroVironment at its Golden Dome Virtual Symposium on Wednesday at 10 a.m.
The price target increase reflects Raymond James’ continued confidence in AeroVironment’s growth trajectory following the BlueHalo merger and its strategic positioning in the defense sector.
In other recent news, AeroVironment reported strong fourth-quarter fiscal 2025 results, surpassing analysts’ expectations. The company posted revenue of $275 million, significantly above the anticipated $242.14 million, marking a 13.61% surprise. Earnings per share also exceeded forecasts, reaching $1.61 compared to the projected $1.40. Stifel maintained its Buy rating for AeroVironment, citing the company’s strong performance, particularly in its Loitering Munitions segment, which generated $138 million in revenue. AeroVironment has provided guidance for fiscal year 2026, projecting revenue between $1.9 billion and $2.0 billion, with adjusted EBITDA expected to be between $300 million and $320 million. The company recently completed its acquisition of BlueHalo, which is expected to positively impact future growth. Analysts from Stifel have expressed optimism about AeroVironment’s plans to increase capital expenditure in new defense technologies. AeroVironment’s strategic focus on expanding its product line, including new autonomous and attack drones, further underscores its growth potential in the defense technology market.
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