Aerospace and defense company AeroVironment (NASDAQ: AVAV) will be reporting earnings this Wednesday afternoon. Here’s what investors should know.
AeroVironment beat analysts’ revenue expectations last quarter, reporting revenues of $641.6 million, up 133% year on year. It was a strong quarter for the company, with a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
Is AeroVironment a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting AeroVironment’s revenue to be flat year on year, slowing from the 140% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. AeroVironment has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at AeroVironment’s peers in the defense contractors segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Huntington Ingalls delivered year-on-year revenue growth of 10.9%, beating analysts’ expectations by 8.2%, and General Dynamics reported revenues up 8.1%, topping estimates by 4%. Huntington Ingalls traded up 16.4% following the results while General Dynamics was down 2.8%.
Read our full analysis of Huntington Ingalls’s results here and General Dynamics’s results here.
In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the defense contractors stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 4.7% on average over the last month. AeroVironment is down 22.9% during the same time and is heading into earnings with an average analyst price target of $225.77 (compared to the current share price of $146).
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