AeroVironment (AVAV) Tumbles 17% as Space Force Eyes More Mobile Ground Suppliers
We recently published 10 Firms Facing a Rough March So Far. AeroVironment Inc. (NASDAQ:AVAV) was one of the worst performers on Monday.
AeroVironment slashed its share prices by 17.42 percent on Monday to close at $208.26 apiece, as investors unloaded portfolios following news that the Space Force would open a $1.4 billion rebidding for mobile ground station supplies—a contract that was won by a subsidiary it recently acquired.
A report by Space News said that the Space Force would conduct a bidding program to attract more contractors for the development of mobile ground stations used to track and command spacecraft in a bid to diversify suppliers and reduce dependence on just one vendor.
The contract was initially awarded to BlueHalo, a subsidiary of AeroVironment Inc. (NASDAQ:AVAV).
Following the news, investment firm Raymond James downgraded AeroVironment Inc.’s (NASDAQ:AVAV) stock to “underperform” from “strong buy” recently, saying that the rebidding could dent its revenue growth outlook.
However, another investment firm, BTIG, differed from the view, with the company reaffirming its “buy” recommendation and $415 price target for the stock.
In its report, BTIG said that contract makes up for only 6 percent of the listed firm’s annual sales, and that the intra-day drop appears overdone for such a contract size.
Meanwhile, investors will watch out for updates about the contract when it conducts an earnings call for its third quarter of fiscal year 2026 performance after market close next Tuesday, March 10, 2026.
While we acknowledge the potential of AVAV as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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