In this article, we will take a look at some of the best unmanned aerial vehicle stocks that are currently offering attractive upside potential to investors.
On April 1, Fox Business had a discussion with Shield AI co-founder Brandon Tseng about how drone warfare is reshaping the United States’ conflict with Iran on The Claman Countdown. The conversation was about the evolution of unmanned aerial systems from the Predator and Reaper drones used in the war on terror to the low-cost tactical drones in Ukraine and now Iran. The conversation was worth paying attention to for investors interested in the evolution of defense technology and military modernization.
In general terms, the U.S. military is using the high-low mix strategy by retaining its advanced military equipment, like the Tomahawk missile, while ramping up the production of the smaller, more affordable drones. Tseng highlighted the need for more affordable drones when he cited the U.S. Air Force’s early loss of 12 MQ-9 Reaper unmanned aircraft, which were worth $40 million each. To support the strategy, Secretary of Defense Pete Hegseth is asking Congress for $200 billion in funding.
The message Tseng was giving investors was quite clear: drones will revolutionize modern warfare, replacing ground troops with a tremendous need for manufacturing capacity. The question investors want answered is which military contractors will provide the drones with the capacity for rapid manufacturing.
In this environment, understanding which defense contractors are positioned to deliver rapid-production drone systems matters more than ever. With that background, let’s explore our 7 Best Unmanned Aerial Vehicle Stocks to Buy Now.
Our Methodology
To identify relevant stocks for this article, we conducted a screening of U.S.-listed unmanned aerial vehicle companies with market capitalizations above $2 billion. Also, we only shortlisted stocks with at least 30% upside potential according to TipRanks consensus, as of April 2 closing. Finally, we selected 7 stocks with the highest upside and ranked them in ascending order.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
7. The Boeing Company (NYSE:BA)
The Boeing Company (NYSE:BA) is one of the 7 best unmanned aerial vehicle stocks to buy now.
On April 1, The Boeing Company (NYSE:BA) and the U.S. Department of War reached a seven-year deal to triple the production capacity of PAC-3 missile defense system seekers in response to the growing demand for air and missile defense worldwide. The deal is a component of the Arsenal of Freedom initiative, which seeks to fortify the American defense system.
The missile defense systems of the United States and its allies can detect, chase, and eliminate threats, including ballistic and cruise missiles, hostile aircraft, and hypersonic threats, thanks to the Boeing-made missile defense system seekers. Since 2024, Boeing has made over $200 million in investments, including a 35,000-square-foot extension of its present factory in Huntsville, Alabama, where it now manufactures PAC-3 missile defense system seekers.
The deal enables Boeing to pursue future cash-neutral investment opportunities in the entire production value chain which will consequently ensure certainty for meeting a growing demand.
The Boeing Company (NYSE:BA) works on building, selling, and providing other services associated with the aerospace and defense industry. Its portfolio consists of three divisions, which include Commercial Airplanes, Defense, Space & Security, and Global Services. These segments collectively cover a number of areas which include commercial aircraft services, logistic and technical services, and intelligence services, amongst others.
6. Joby Aviation Inc. (NYSE:JOBY)
Joby Aviation Inc. (NYSE:JOBY) is one of the 7 best unmanned aerial vehicle stocks to buy now.
On March 10, H.C. Wainwright made a comment on the eight selections made in the eVTOL Integration Pilot Program announced by the U.S. Department of Transportation and the FAA. According to Wainwright, the beginning of the U.S. federal initiative is an important de-risking event for the industry players, including Joby Aviation Inc. (NYSE:JOBY).
According to the firm, the 100% bonus depreciation may prompt the fleet operators, along with the airline partners, including United and Delta, to consume the supplies early, while the limited options available to the FAA.
On February 25, Uber Technologies Inc. (NYSE:UBER) and Joby Aviation Inc. (NYSE:JOBY) announced that Uber Air, powered by Joby, is offering passengers a preview of how they may reserve an all-electric air taxi straight through the Uber app.
Later this year, Joby intends to transport its first passengers in Dubai, marking a significant turning point in the collaboration to provide multimodal transport to cities worldwide. Users only need to launch the Uber app, enter their location, and select Uber Air, powered by Joby, if it is available.
Joby Aviation Inc. (NYSE:JOBY) conducts studies on electric vertical takeoff and landing aircraft. It is also involved in their production, evaluation, and sales around the world. It offers several services to its customers, which include facilitation of passenger transportation, providing flight services to the government, and more.
While we acknowledge the potential of JOBY to grow, 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 AI stock that is more promising than JOBY and that has 100x upside potential, check out our report about the cheapest AI stock.
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