Drone Delivery Canada (TSXV:FLT) & AeroVironment: Why Are Drone Stocks Climbing?

Summary

• Stocks of Drone Delivery have rebounded nearly 54 per cent since the pandemic-led meltdown on March 24.
• Robin XL & Condor’s pre-selling testing results are getting positive market reactions in Canada and globally, as per Drone Delivery’s exchange filing.
• In its year-to-date performance, AeroVironment stocks have swelled by 41.62 per cent.

Drones and advanced unmanned aerial vehicle (UAV) technology have boosted the productivity of several industries within a short span of time. Drones have been inducted for security vigilance, safety scrutinization, asset supervision and surveillance, storm tracking, and logistics. Consumer enterprises utilize drones for express delivery, and other organizations like mining, surveying, and agricultural activities.  Two drone stocks – Drone Delivery Canada (TSXV:FLT) and AeroVironment, Inc. (NASDAQ:AVAV) – have been trending in the Canadian markets recently.

Drone Delivery Canada successfully trialled the Robin XL drone, which comprises of communications system, route-finding system, automatic pilot system, take-off and landing performance, general flight steadiness, and presentation. The trial followed the guidelines provided by Transport Canada. Robin XL’s pre-selling testing results are getting positive market reactions in Canada and globally. The drone company is working on prospective opportunities for both UAVs, stated President & CEO, Drone Delivery Canada.

Leading global all environment (AE) unmanned aircraft system (UAS) manufacturer AeroVironment, Inc. (NASDAQ:AVAV) announced receiving US$ 8.37-million contract from the US Defense Foreign Military Sales (FMS) for its Puma™ 3 AE tactical UAS in September. The company is expected to deliver the first trench by March 2021. He drones will be used for training purposes.

Drone Delivery Canada Corp. (TSXV:FLT)

Current Stock Price: 0C$ .80

Drone Delivery Canada develops and retails drones. It offers logistic services to the depot, warehouses, and government agencies for in time delivery assistance. The company is taking new initiatives and upgrading its drone system with the new flow of customer order delivery and evolving distribution pattern amid the pandemic. It is planning to provide a Software-as-a-Service (SaaS) product for government and corporate enterprises.

The company is working with world-class organizations such as Toronto university and Ford to advance its technology and applications for drone delivery. Its engagement in research and development program resulted in unique and patented intellectual property and the successful trade of its advanced logistics solution, stated Michael Zahra, President, & CEO, Drone Delivery Canada.

Drone Delivery Canada Stock Performance

The drone company stock is up nearly 16 per cent in the last three months. The stock has rebounded almost 54 per cent since the pandemic-led meltdown in March. Its current market capitalization stands at approximately C$ 154 million. Its price-to-book ratio is 10, as per data on the TMX portal.

The company has been listed among TMX’s top junior tech companies across TSX Venture Exchange.

AeroVironment, Inc. (NASDAQ:AVAV)

Current Stock Price: US$ 88.91

AeroVironment offers technology solutions such as robotics, sensors, software services. It operates under a single segment, which delivers unmanned aircraft systems, strategic missile systems, high-altitude quasi-satellites, and other drone-related services to government agencies of the United States as well its allies.

AeroVironment Stock Performance

In the last six months, the drone stock has increased by over 25 per cent. The year-to-date performance of the scrips indicates a 41.62 per cent surge. The tech stock has recovered over 86 per cent since the pandemic-led market collapse on March 13. Its current market cap stands at US$ 2.14 billion.

AeroVironment’s price to book ratio is 4.122, and its current price-to-cash flow (P/CF) ratio is 42.40. The international drone company delivers a positive return on equity (ROE) of 6.80 per cent and a positive return on assets (ROA) of 6.12 per cent. The company’s current debt to equity (D/E) ratio is 0.03. Its price-to-earnings (P/E) ratio is 60.50. Its current earnings per share stand at US$ 1.42, as per the data available on the TMX website.

AeroVironment Financial Highlights

The company reported revenue of US$ 87.5 million for the first quarter of fiscal 2021.

Its net income stood at US$ 10.1 million in Q1 FY21, as compared to US$ 17.1 million for Q1 FY20. The company posted a decrease in its income from operations due to a rise in research and development cost of US$ 2.4 million.

For FY21, AeroVironment aims to generate revenue between US$ 390 million to US$ 410 million and earnings per diluted share of US$ 1.65 to US$ 1.85, the company said in a financial statement.