UAV Stock Spotlight: Opportunity Abounds in the Drone Space

Unmanned aerial vehicles represent a huge growth market as associated and complimentary technological innovations and new end markets develop and mature. Drones have an increasing number of hi-tech applications and are getting better at doing more.

New technologies such as lidar and AI autonomous control promise to continue to expand these horizons further in the years ahead, pushing the boundaries of what we can do to increase efficiency in supply chains, crime prevention, delivery of goods, agriculture, manufacturing, and human transport, just to name a few.

A report from industry insider, Fortune Business Insights, projects the global commercial drone market will grow from $1.59 billion in 2019 to $8.53 billion by 2027, exhibiting a stunning CAGR of 25.07% during the forecast period.

This could help to define the fortunes of some interesting stocks with exposure to the space, including Ambarella Inc (NASDAQ:AMBA), Draganfly Inc (OTCMKTS:DFLYF), GoPro Inc (NASDAQ:GPRO), Epazz Inc (OTCMKTS:EPAZ), AeroVironment, Inc. (NASDAQ:AVAV), and Ageagle Aerial Systems Inc (NYSEAMERICAN:UAVS). We focus on a few of the most interesting names below.

AeroVironment, Inc. (NASDAQ:AVAV) bills itself as a company that provides users with the ability to identify threats and deliver a precision lethal payload with minimal collateral damage. Switchblade® 300 and Switchblade® 600 loitering missile systems enable the warfighter to easily launch, fly, track and engage beyond line-of-sight targets and light armored vehicles across land, maritime and air-launched scenarios.

The Blackwing loitering reconnaissance system is a variant of Switchblade designed to provide rapid-response intelligence, surveillance and reconnaissance capabilities and can be deployed from a submarine using an underwater-to-air delivery canister, shipboard or mobile ground vehicle via tube-launch or Multipack Launcher (MPL). AeroVironment’s tactical missile systems deliver the actionable intelligence and precision firepower needed to achieve mission success across multiple domains.

AeroVironment, Inc. (NASDAQ:AVAV) recently announced it received a $13,010,560 cost-plus-fixed-fee contract order on March 24, 2021 from the U.S. Army for Switchblade® 300 tactical missile systems contractor logistics support. The contract has a total potential value of $40,852,467, for which funding was authorized via a DoD-approved Joint Urgent Operational Need Statement. Logistics support services are scheduled to be delivered through March 2024.

“AeroVironment provides customers with logistics operation services, such as operator training, flight support and maintenance, to ensure the unmanned aircraft systems and tactical missile systems are operationally ready for deployment at any time,” said Brett Hush, AeroVironment vice president and product line general manager for tactical missile systems.

The stock has suffered a bit of late, with shares of AVAV taking a hit in recent action, down about -5% over the past week.

AeroVironment, Inc. (NASDAQ:AVAV) generated sales of $78.8M, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of -15% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($373M against $56.1M).

 

Epazz Inc (OTCMKTS:EPAZ) promulgates itself as a leading provider of drone technology, blockchain mobile apps, and cloud-based business software solutions.

Its holding, ZenaTech Inc., is a drone-smart hemp farming solution that monitors the plant life cycle from growth to sale. In accordance with government regulations for quality assurance measures, ZenaPay tracks, monitors and calculates plant life cycles in real time, providing accurate data extraction for management and auditing reports and certifying the plant life cycle from start to its targeted purpose.

Epazz Inc (OTCMKTS:EPAZ) most recently announced that ZenaTech is beta testing the ZenaDrone 1000 in Ireland this week. The drone will power next-generation farms and change the way farms do business.

According to the release, the ZenaDrone 1000 is the first of many new drone technologies that ZenaTech is developing. The company is working on a mobile power station to recharge drones that are thousands of feet from a power outlet, which is part of the company’s charging-pad technology that allows for wireless charging. The company will release details in the coming weeks.

Dr. Shaun Passley, CEO of Epazz and ZenaPay, said, “The charging pad is key to autonomous drone activities. Now we are extending our technology for a mobile power station. The mobile power station will extend the range of the ZenaDrone 1000, allowing it to cover more ground during a period of time.”

Epazz Inc (OTCMKTS:EPAZ) shares have doubled in the past 5 months. The stock has pulled back recently, but maintains its rally in terms of the logarithmic trendline off the lows put in place early last year well under the penny level.

 

Ageagle Aerial Systems Inc (NYSEAMERICAN:UAVS) trumpets itself as one of the nation’s leading commercial drone technology providers. AgEagle’s mission is to empower The Drone Age by providing American-made, tailored and scalable drone solutions to the world.

The Company is leveraging its reputation as one of the industry’s premium technology solutions and aerial data intelligence providers to deliver high performance, end-to-end drone solutions to the agriculture, commercial and industrial markets. AgEagle products are proudly manufactured and assembled in the United States.

Ageagle Aerial Systems Inc (NYSEAMERICAN:UAVS) recently announced that MicaSense, an AgEagle company, is participating in AUVSI XPONENTIAL 2021 virtual conference this week.

According to the company’s release, MicaSense’s Channel Sales Manager, Emily Ciesielski, will host a virtual educational session, titled “Image Classification, Irrigation Monitoring & More Using Multispectral & Thermal Imaging,” on May 6, 2021 beginning at 1:00 PM ET. Registered conference attendees can access and view the live presentation online by going to the conference’s “Education” menu, selecting “ENT & GOV’t Solutions,” and choosing the MicaSense presentation. MicaSense will also have a virtual booth located in the online exhibit hall.

While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action UAVS shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -11% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities. Over the past month, shares of the stock have suffered from clear selling pressure, dropping by roughly -22%.

Ageagle Aerial Systems Inc (NYSEAMERICAN:UAVS) pulled in sales of $127K in its last reported quarterly financials, representing top line growth of -32.5%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($23.9M against $2.2M).

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