Shares of defense play AeroVironment have been rising amid the war in Ukraine and the Israel-Hamas conflict. On Wednesday, the Relative Strength (RS) Rating for AeroVironment stock rose from 78 to 82, passing a major milestone along the way.
The upgraded 82 RS Rating puts Arlington, Va.-based AeroVironment in the top 18% of all stocks for price performance this past year. Market research reveals that the best stocks to buy and watch typically have an RS Rating above 80 as they launch their biggest price moves.
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AeroVironment Stock Ratings Generally Shine
AeroVironment makes drones used by the Air Force for research, and the company reportedly is the U.S. military's top drone supplier overall. It also sells to NASA and developed an early model electric vehicle.
Among its other key ratings AeroVironment stock has a strong 93 Composite Rating out of 99. It carries an 83 Earnings Per Share Rating. That reflects smaller earnings growth in prior years; this last year it reported robust earnings.
It has a B SMR Rating (sales + profit margins + return on equity), demonstrating fundamental strength. One yellow flag is its C- Accumulation/Distribution Rating, showing that university funds, mutual funds and other institutional investors are selling slightly more shares than buying. Look for that to improve to C or better.
AeroVironment stock is building a consolidation with a 143.99 buy point. See if it can clear the breakout price in volume at least 40% higher than normal. The 143.99 buy point is its all-time intraday high, set on Dec. 4. It consolidated from there and has mostly moved sideways the last few months. Wednesday afternoon the aerospace company traded at about 125.
Profit Ostensibly Rises 9,600%
In terms of fundamentals, top and bottom line growth both moved higher in the company's most recent quarter. Earnings shot up to 97 cents per share vs. a 1-cent profit the same quarter a year ago. The prior three stanzas EPS growth rose from 6% to 250%, and the quarter before last it reported a $1 per share profit, reversing powerfully from an 8-cent loss the same period a year earlier.
Revenue increased 62% to $180.8 million last quarter. The three quarters before that sales grew 49%, 40% and 40%. AeroVironment says on it website it plans to announce fiscal third quarter results after the market closes on March 4.
The company earns the No. 12 rank among its peers in the 71-stock Aerospace/Defense industry group. Small-cap communications, control systems and radar parts maker Mtron Industries and Brazilian aircraft maker Embraer are among the group's highest-rated stocks.
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