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Investing.com - Cantor Fitzgerald maintained its Overweight rating on AeroVironment (NASDAQ:AVAV) with a price target of $335.00. The stock, currently trading at $265, has demonstrated remarkable momentum with a 72% year-to-date return. According to InvestingPro analysis, AVAV is currently trading above its Fair Value.
The research firm’s assessment comes as it evaluates the drone manufacturer using a weighted average of two valuation approaches: EV/EBITDA (50%) and EV/Revenue (50%) against fiscal year 2028 estimates.
Cantor Fitzgerald acknowledges that the 40x EBITDA and 4x sales metrics appear stretched compared to traditional defense and government technology companies.
Despite these seemingly high multiples, the firm believes ongoing catalysts will keep AeroVironment shares in what it describes as a "less detached state" similar to current space industry valuations, which range from approximately 50-100x EV/EBITDA and 5-30x sales.
The firm also draws comparisons to other drone category leaders, noting that Kratos (NASDAQ:KTOS) has approached roughly 50x trailing twelve-month EV/EBITDA over a multi-year period.
In other recent news, AeroVironment has been in the spotlight with several notable developments. Stifel has raised its price target for AeroVironment to $295, citing the company’s new financing plans, which include $650 million in new debt and $875 million in equity financing. This move reflects optimism about AeroVironment’s investment opportunities in core markets. Cantor Fitzgerald initiated coverage on AeroVironment with an Overweight rating and a $335 price target, pointing to the company’s growth potential in drone technology and its recent Blue Halo acquisition as key factors. RBC Capital also raised its price target on AeroVironment to $275, highlighting increased program opportunities and strong Switchblade sales as significant contributors. The company exited fiscal year 2025 with an annual run rate of approximately $500 million for the Switchblade product line, with expectations of reaching over $1 billion. Meanwhile, the Pentagon has ordered a significant acceleration in drone production and deployment, which has positively impacted drone-related stocks, including AeroVironment. These developments come as the Department of Defense aims to prioritize unmanned aircraft systems on par with major weapons systems.
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