TLDR
- Shares of AVAV increased 1.1% following a CBS 60 Minutes feature highlighting its LOCUST laser counter-drone technology
- The LOCUST system operates at a few dollars per shot compared to $4 million missiles targeting drones worth $20,000–$40,000
- The company’s funded backlog expanded 47% year-over-year during Q3’26, achieving a 1.07x book-to-bill ratio
- AVAV recorded a $151 million goodwill impairment following termination of its Space Force SCAR agreement
- An analyst maintains a Strong Buy recommendation on AVAV with a $363 target, pointing to expanding worldwide drone requirements
National television exposure for AeroVironment’s LOCUST laser platform caught the attention of investors Sunday evening.
Shares climbed 1.1% to $209.29 during early Monday sessions following CEO Wahid Nawabi’s appearance on CBS’s 60 Minutes, where he discussed the company’s directed energy capabilities. The S&P 500 advanced 0.6% while the Dow gained 0.4% during the same period.
The broadcast highlighted a critical asymmetry: Iran’s Shahed drones carry a price tag of $20,000–$40,000 per unit. Traditional missile interceptors cost $4 million each. This economic imbalance has driven the Pentagon to pursue more cost-effective alternatives.
LOCUST — an acronym for Laser Optical Counter-Unmanned Aerial System for Tactical Use — represents one such alternative. The platform leverages artificial intelligence for target acquisition and tracking, neutralizing drone threats in seconds. Operating cost per engagement? Just a few dollars.
Deployment of the system has already occurred along the southern U.S. border, where it’s actively countering drug cartel drone operations.
Order Book and Manufacturing Growth
Beyond the television exposure, AVAV benefits from substantial fundamental momentum. The company reported a 47% year-over-year increase in funded backlog at the close of Q3’26, resulting in a book-to-bill ratio of 1.07x.
During the third quarter of fiscal 2026, the U.S. Army issued a $186 million purchase order for Switchblade 600 Block 2 and Switchblade 300 platforms. This order falls under a broader 5-year, $990 million contract granted in 2024.
AVAV is currently expanding its Salt Lake City production facility to accommodate $2 billion in incremental annual revenue capacity. The company also plans to quadruple Titan C-UAS production in 2026 and increase it tenfold by 2030.
In December 2025, the Army issued AVAV a separate 5-year, $874 million IDIQ contract supporting foreign military sales of its drone and counter-drone platforms.
AVAV is currently engaged in ongoing discussions with Asian partners including Taiwan, Japan, and South Korea regarding autonomous defense platforms.
Space Contract Termination
The overall narrative isn’t entirely positive. AVAV recently ended its agreement with the U.S. Space Force for the BADGER phased array antenna platform after negotiations regarding firm-fixed-price terms collapsed.
The company recognized a $151 million goodwill impairment charge during Q3’26 related to its space division. Leadership indicated the revenue impact would remain below $100 million, though as much as $1.5 billion in unfunded backlog could be affected.
AVAV retains the ability to submit a new bid on the program under revised terms.
Prior to Monday’s session, shares were down 14% year to date — primarily attributable to the contract termination announcement — while maintaining a 60% gain over the trailing 12 months.
One analyst has assigned a Strong Buy rating to AVAV with a $363 price objective, based on 53.18x FY27 EV/aEBITDA. Current trading multiples sit at 50.29x, beneath the historical midpoint.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
