This article looks at the 10 best drone stocks to buy according to billionaires. We will also discuss recent trends in the industry from both the military and commercial contexts.
Over the past week, swarms of loitering drones filled the skies of India and Pakistan as the two nuclear-armed neighbors in South Asia waged what the BBC described as the world’s first drone war. This revolution in warfare has blurred the lines between man and machine, resulting in a need for a reassessment of military capabilities.
READ ALSO: 10 Best Military Drone Stocks to Buy Now and Goldman Sachs Defense Stocks: Top 12 Stock Picks.
Drones were a prominent feature of the Nagorno-Karabakh conflict between Azerbaijan and Armenia, and have also clouded the skies across several towns and cities during the Russia-Ukraine war. With the demand for drones surging over the last few years, defense tech start-ups such as Anduril Industries are redefining modern warfare through the next generation of autonomous, AI-driven systems.
The company has built a range of modular, AI-guided drones and uncrewed aircraft for the US military, which is presenting a challenge for traditional defense contractors, due to its superior tech defense capabilities that are cheaper and autonomous.
In December last year, Anduril announced a partnership with OpenAI, which will further enable the deployment of advanced AI systems for defense missions. The move is part of a growing trend among artificial intelligence companies to walk back bans on the military use of their products, with many firms entering into partnerships with the Department of Defense.
Anduril is also working on guarding against the threats posed by UAVs. In October 2024, the DoD awarded a $250 million contract to the company to counter drone attacks against American forces. Under the contract, the US will receive 500 recoverable Roadrunner interceptors, which are reusable drones that can intercept incoming drones or land back on the ground if they are not engaged.
When people think of drones, they often associate them with expensive military aircraft or personal recreational use. However, several corporations are now utilizing drones for commercial applications, such as deliveries, data collection, and inspections.
According to a report in January this year, the global commercial drone market size was estimated to have a value of $29.91 billion in 2024. It is projected to reach $33.96 billion in 2025 and climb to $93.78 billion by 2033, amid a surge in the deployment of drones for commercial operations.
With that said, let’s now head over to the list of the best drone stocks to buy according to billionaires.
Palmer Luckey of Anduril
Our Methodology
We sampled stocks from ETFs with exposure to drones and our previous articles on the subject. The pool of stocks included both military and non-military drone companies that develop and explore solutions to enable drone technologies to operate more efficiently.
From there, we picked the top 10 stocks with the highest number of billionaires having a stake in them, as per Insider Monkey’s Q4 2024 proprietary database of billionaires’ stock holdings. Where two or more stocks were tied on billionaire sentiment, we used the dollar value of billionaire holdings as a tiebreaker between them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Drone Stocks to Buy According to Billionaires:
10. Elbit Systems Ltd. (NASDAQ:ESLT)
Number of Billionaires: 6
Billionaire Holdings: $6,483,797
Elbit Systems Ltd. (NASDAQ:ESLT) is an Israel-based defense technology company, offering a comprehensive range of military drones, from the man-portable Skylark LEX to the multi-mission Hermes-900. According to reports, Elbit’s SkyStriker was among the drones used by the Indian military against Pakistan in the recent conflict.
The stock has had year-to-date returns of 47%, driven by high-value defense contracts and robust financial performance. In November last year, Elbit Systems Ltd. (NASDAQ:ESLT) won awards worth $335 million to supply defense systems to a European country. The weapons include PULS rocket launchers and rockets, and Hermes 900 unmanned aircraft systems that are equipped with advanced payloads.
The company also boasts capabilities in counter-UAS solutions, which has earned it a strong reputation of being one of the best drone stocks. In January, a NATO European country awarded Elbit Systems Ltd. (NASDAQ:ESLT) a $60 million contract for its multi-layered Counter Unmanned Aerial Systems (C-UAS).
Elbit Systems Ltd. (NASDAQ:ESLT) is expected to report earnings for the first quarter of fiscal 2025 on May 20. Analysts forecast EPS of $2.3 for the quarter, which, if met, will represent a 27% increase from the same period last year.
9. AeroVironment, Inc. (NASDAQ:AVAV)
Number of Billionaires: 7
Billionaire Holdings: $78,352,940
AeroVironment, Inc. (NASDAQ:AVAV) designs and manufactures unmanned aerial vehicles, ground robot systems, and loitering munition systems.
On May 6, the company launched Red Dragon, a fully autonomous, software-designed UAS developed for one-way attack missions. The drone is built to operate in high-threat environments where traditional technology fails. It is built on AeroVironment, Inc. (NASDAQ:AVAV)’s AVACORE shared integration software, which enables rapid development, modular mission integration, and scalable manufacturing.
In April, AeroVironment, Inc. (NASDAQ:AVAV) secured a $47 million contract from Italy for its JUMP 20 VTOL medium uncrewed aircraft system (MUAS), a fixed-wing UAS, designed for advanced ISR missions. The contract will run for five years and includes the procurement of drones, engineering services, initial sustainment, and onsite support.
Earlier this month, AeroVironment, Inc. (NASDAQ:AVAV) announced the successful completion of the acquisition of BlueHalo LLC, a leading space and defense engineering company. This is expected to help AVAV further expand its portfolio amid ongoing geopolitical tensions in different parts of the world.
Wall Street analysts are bullish on AeroVironment, Inc. (NASDAQ:AVAV) with a consensus Buy rating and anticipate an 18% uptick, on average, in its share price. Investor sentiment also remains strong. According to Insider Monkey, 7 billionaires hold a stake in the company, making it one of the best drone stocks to buy.
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