Buy 3 Drone Technology Stocks for a Stable Portfolio in 2026

A drone, also called an unmanned aerial vehicle (UAV), operates autonomously or through a remote control with no pilot on board. The technology has evolved over the years to graduate from basic civilian and military operations to highly advanced missions, making drones an indispensable tool in various industries. 

We have narrowed our search to three drone-technology-centric bigwigs that provide the hardware and software to operate drones. These stocks will provide stability to your portfolio in 2026. 

These stocks are: Kratos Defense & Security Solutions Inc. KTOS, Textron Inc. TXT and L3Harris Technologies Inc. LHX. Each of our picks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The chart below shows the price performance of our three picks in the past three months.

Kratos Defense & Security Solutions Inc.

Kratos Defense & Security’s growth prospects are backed by America’s stable funding provisions. Apart from manufacturing unmanned aerial drone systems, KTOS focuses on expanding its product portfolio with other products, especially in hypersonic. 

KTOS’ diverse product portfolio resulted in a backlog worth $1.41 billion at the end of the second quarter. President Donald Trump’s proposal to boost the nation's fiscal 2026 defense budget by 13% should bode well for KTOS.

Kratos Defense & Security has an expected revenue and earnings growth rate of 15.7% and 4.8%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2% over the past 90 days.

KTOS has an expected revenue and earnings growth rate of 19.1% and 40.9%, respectively, for the next year. The Zacks Consensus Estimate for next-year earnings has improved 1.4% over the past seven days.

Textron Inc.

Textron has been benefiting from improving commercial air passenger traffic in its Aviation business unit. Apart from its strong presence in the commercial aerospace market, TXT enjoys solid demand for its defense products. TXT has been innovating products to capture more shares in the diverse markets it serves. 

Apart from its strong presence in the commercial aerospace market, TXT enjoys solid demand for its defense products as well. To this end, it is imperative to mention that in the second quarter of 2025, TXT’s Bell segment signed a contract with the Tunisian Air Force for 12 SUBARU Bell 412EPXs, while Textron Aviation partnered with Thai Aviation Industries to support the Royal Thai Air Force.

Textron has an expected revenue and earnings growth rate of 8% and 12.2%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.2% over the past seven days.

TXT has an expected revenue and earnings growth rate of 3.5% and 10.2%, respectively, for the next year. The Zacks Consensus Estimate for next year's earnings has improved 0.1% over the past seven days.

L3Harris Technologies Inc.

L3Harris Technologies enjoys a strong presence in the U.S. defense industry. Solid U.S. defense budget funding provisions should bolster its revenues. LHX is poised to contribute to the U.S. administration’s Golden Dome initiative through its missile warning sensors. 

LHX also witnessed strong demand for its defensive solutions from Asia-Pacific, Latin America, South America, and the NATO allies of the United States. Positive synergies from acquisitions have been bolstering LHX's growth.

L3Harris Technologies has an expected revenue and earnings growth rate of 2.1% and -19.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.1% over the past seven days.

LHX has an expected revenue and earnings growth rate of 6.3% and 17.8%, respectively, for the next year. The Zacks Consensus Estimate for next year's earnings has improved 0.2% over the past seven days.

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This article originally published on Zacks Investment Research (zacks.com).

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