AeroVironment: This Defense Stock Had Missed The Middle East Rally

Julia Ostian5.52K FollowersFollow5ShareSavePlay(17min)CommentsSummaryAeroVironment, Inc. is rated buy after a significant drop, with upside potential outweighing downside risk despite the SCAR contract loss.AVAV's $1.7B SCAR contract termination led to a $151.3M goodwill impairment and reduced FY26 revenue guidance to $1.85–$1.95B.The current backlog stands at $1.1B, with new contracts—including $186M for Switchblade drones—demonstrating robust demand for AVAV's defense technologies.I am trading AVAV for short-term upside, preferring larger defense names or ETFs for long-term holdings due to volatility and government contract risks. Victoria Kotlyarchuk /iStock via Getty Images Introduction One of the most interesting topics we can discuss today is warfare and drones, specifically as a modern weapon, for its wide adoption, low prices, and effectiveness. Today’s research will largely be focused on AeroVironment, Inc. (This article was written byJulia Ostian5.52K FollowersFollowI write about stocks I’m personally interested in adding to my portfolio. I’m not a professional advisor, but I study business and economics and analyze markets full-time. My writing is meant for both complete beginners — I avoid unnecessary complexity — and advanced readers, as I always aim to offer a distinct and well-reasoned perspective.I also run a YouTube Channel called "The Market Monkeys" and break some of the stocks there as well.Analyst’s Disclosure: I/we have a beneficial long position in the shares of AVAV either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.