Daily Insight — Aerovironment (AVAV): Daily Insight

Our Read. AeroVironment more than doubled revenue in fiscal 2026, to $1,976.8 million from $820.6 million, a 141% increase driven by the BlueHalo acquisition [1]. The stock has fallen 64.6% from its October closing high anyway [6]. Our read: the damage in the accounts is mostly the accounting of a just-closed deal plus one cancelled program, not a broken franchise, and the price now sits below every valuation the market has put on this company in five years. Strength of belief: medium. This is our interpretation; the filing itself does not say the worst is past.

Where we stand. Not positioned. Looking for an entry at $137, with the next quarterly filing showing backlog still growing. That level sits at the floor of the last year's trading: the lowest close of the past 52 weeks was $136.68 on June 25, 2026, and the stock moves 3.57% on an average day, so $137 is a price real sellers have recently accepted, not a hope [6].

The situation. The ugly numbers are real. Gross margin fell from 39% to 25% [1]. A $240.7 million goodwill charge hit the Space unit after the customer terminated the SCAR agreement for convenience in March 2026 [2]. Management concluded its disclosure controls were not effective at April 30, 2026 because of material weaknesses [3]. Insiders made zero open-market purchases in the last 180 days, with 10 sales totalling 2,599 shares, most recently August 17, 2026 [7].

The stock. At $145.11 the company trades at 4.0x enterprise value to revenue. Its own five-year range runs from a low of 4.8x to a high of 6.0x, and the peer median is 4.8x, so today's multiple is below anything in its own history and below the group [6]. Funded backlog was $1,120.7 million at January 31, 2026, up from $726.6 million at April 30, 2025 [5]. The $747.5 million of convertible notes converts at roughly $322.40, more than double today's price, so dilution from them is a distant concern [4].