Shares of AeroVironment tumbled 9.7% to $120.40 on September 14, as investors digested a significant price-target cut from BofA Securities, which lowered its mark from $225 to $185 while maintaining a Buy rating. The selloff caps a volatile stretch for the defense drone maker, whose stock has now swung sharply on multiple sessions despite reporting record results. AeroVironment Beat Every Estimate and Still Got Punished — Can Record Backlog Rescue a Stock in Freefall?
Shares of AeroVironment cratered 9.7% to $120.40 on September 14, extending a brutal slide that has erased more than 70% from the stock's 52-week high of $417.86, even as the defense drone maker keeps posting record numbers. The catalyst: BofA analyst Ronald Epstein maintained a Buy rating but slashed his price target to $185 from $225 , amplifying a crisis of confidence already gripping shareholders.
Record Quarter, Shrinking Credibility Gap. AeroVironment reported adjusted earnings of $0.59 per share on revenue of $480.5 million, significantly exceeding Wall Street estimates of $0.30 and $459.9 million, respectively.
The company reaffirmed its full-year fiscal 2027 guidance, projecting adjusted EPS of $3.02 to $3.34 and revenue of $2.125 billion to $2.225 billion. Yet the stock has barely responded to the upside. The market is telling management that beating estimates once is not enough — investors want proof the company can consistently convert its pipeline into profits.
A Massive Backlog That Hasn't Calmed Nerves. AeroVironment reported bookings of $0.7 billion and a book-to-bill ratio of 1.4, with funded backlog reaching a record $1.5 billion, up 37% year-over-year. On paper, that's nearly a full year of revenue visibility. But budget approval timing remains an uncertainty , and investors are also watching a securities lawsuit alleging inadequate disclosures around competitive risks and a government stop-work order. That legal overhang is dampening confidence that the backlog will convert smoothly.
Insider Selling Adds to the Unease. CEO Nawabi sold 28,265 shares at $139 while analysts had a $226 average price target , a timing and optics problem that leaves investors questioning whether insiders see the same future Wall Street does. The price target cut lands on a stock "already deep in a multi-month slide."
Wall Street Is Split, but Leaning Bullish. Citizens kept a Market Outperform rating at $230, while JPMorgan raised its target to $210 on September 10.
Two analysts rate the stock a Strong Buy, eighteen a Buy, three a Hold, and one a Sell. At $120.40, the stock trades at a roughly 43% discount to the average analyst target — either a screaming value or a sign that the Street hasn't caught up with the deterioration. For shareholders, the question is stark: a $1.5 billion backlog and record revenue haven't stopped the bleeding, so what will?