AeroVironment (AVAV) Faces Challenges with Low ROE and Declining Earnings

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Apr 09, 2025
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Key Points:

  • AeroVironment's (AVAV, Financial) stock has plummeted 26% in the last quarter.
  • The company shows a return on equity of 3.8%, underperforming the industry average.
  • Analysts project an average target price of $188.02, indicating a potential 55.13% upside.

AeroVironment Inc. (AVAV) has recently experienced a significant stock decline, dropping by 26% over the past three months. This reduction poses concerns, especially when the company's return on equity (ROE) stands at a mere 3.8%, which falls short compared to the industry average of 12%. Despite efforts to retain profits, a 25% reduction in net income over five years suggests potential underlying issues affecting performance.

Wall Street Analysts Forecast

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Wall Street analysts have provided their insights, with five experts offering a one-year price target for AeroVironment Inc (AVAV, Financial). The average projected price is $188.02, with estimates ranging from a high of $225.00 to a low of $146.00. This average target price represents a promising upside of 55.13% from the current stock price of $121.20. Investors can access more detailed estimates on the AeroVironment Inc (AVAV) Forecast page.

Moreover, the consensus from six brokerage firms designates AeroVironment Inc (AVAV, Financial) with an average recommendation of 1.3, suggesting a "Buy" status. On the recommendation scale, 1 stands for a Strong Buy, while 5 indicates a Sell.

According to estimates from GuruFocus, the GF Value for AeroVironment Inc (AVAV, Financial) in the next year is calculated to be $175.26. This projection suggests an upside potential of 44.6% from the present price of $121.20. The GF Value is GuruFocus’s estimate of the stock's fair trading value, derived from historical multiples, past business growth, and anticipated future business performance. Detailed information is available on the AeroVironment Inc (AVAV) Summary page.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.