AeroVironment stock maintains Strong Buy rating at Raymond James

Investing.com - Raymond James has reiterated its Strong Buy rating on AeroVironment (NASDAQ:AVAV) with a price target of $348.00, following the company’s Investor Day event. The stock, currently trading near $309, has delivered an impressive 100% return year-to-date, with InvestingPro data showing strong analyst consensus and 4 recent upward earnings revisions.

The investment firm expressed increased confidence in AeroVironment’s outlook after attending the event, which showcased the company’s transformation up the value chain through its products, solutions, and systems over the past year. This transformation is reflected in the company’s robust 44% revenue growth over the last twelve months, though InvestingPro analysis indicates the stock is currently trading above its Fair Value.

While AeroVironment did not provide updated financial guidance during the event, the company projected a total addressable market (TAM) of $75 billion by 2030, suggesting potential revenue of $4 billion, which Raymond James considers reasonable.

The $4 billion revenue target would represent approximately 5% market share, accounting for increasing competition while still allowing for significant TAM expansion in the coming years.

Raymond James believes $4 billion in revenue and approximately $800 million in EBITDA by 2030 serves as an appropriate benchmark to evaluate AeroVironment’s performance over the next five years.

In other recent news, AeroVironment, Inc. announced enhancements to its Puma LE drone, adding a laser target designator and universal gimbal kit to expand its capabilities beyond reconnaissance. The company also secured a contract with the U.S. Space Force for the delivery of two BADGER phased array antenna systems, supporting the Satellite Communication Augmentation Resource program. Additionally, AeroVironment signed a memorandum of understanding with Taiwan’s National Chung-Shan Institute of Science and Technology to collaborate on autonomous systems for Taiwan’s defense needs. In leadership changes, Johnathan Jones has been appointed as Senior Vice President of Cyber and Mission Solutions, where he will oversee strategic direction and operations. AeroVironment also reported the successful air launch of its Switchblade 600 loitering munition system from an MQ-9A Reaper unmanned aircraft, in collaboration with General Atomics Aeronautical Systems. These developments highlight AeroVironment’s ongoing efforts to enhance its product offerings and strategic partnerships.

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