by Fred Fuld III
Unmanned aerial vehicles, better known as drones, are everywhere.
They are used in all types of industries.
For example, drones are being used by the following types of businesses and organizations:
Construction
Agriculture
Insurance Claims
Offshore Oil & Gas
Police
Fire
Coast Guard
Journalism
Customs and Border Protection
Real Estate
Utilities
Pipelines
Mining
Clean Energy
Cinematography
According to InsiderIntelligence, “The drone services market size is expected to grow to $63.6 billion by 2025.”
A few large corporations are involved in drone development and production as a small part of their business, but there are a few pure plays.
Many of these stocks have taken a beating over the last year or so, so maybe there are some bargains waiting to take off.
AeroVironment (AVAV) is an Arlington, Virginia based company which creates and manufactures robotic systems with a large unmanned aircraft systems division. Their market is primarily governments so their cash flow is relatively steady.
The stock has a forward price to earnings ratio of 38 and has an earnings per share growth estimate of 63% for next year.
Kratos Defense & Security Solutions (KTOS), based in San Diego, California, provides unmanned aerial systems to the U. S. Government.
The stock has a forward P/E ratio of 24, and has an earnings per share growth estimate of 60% for next year.
Ambarella (AMBA) is a video semiconductor company which makes cameras for drones and for many other purposes. The stock has a nosebleed forward P/E of 131.
Although earnings per share for this year were up58%, earnings for next year are anticipated to be down 34%
EHang Holdings Ltd. (EH) is a China based company which produces autonomous aerial vehicles. Earnings were negative for the current year and are expected to be negative next year.
Joby Aviation Inc. (JOBY) is building an electric vertical takeoff and landing aircraft optimized to deliver air transportation. It has had negative earnings for last year with the same expected for next year.
Maybe one of these stocks can help your portfolio rise.
Disclosure: Author didn’t own any of the above at the time the article was written.