Jim Cramer on AeroVironment, Inc.: "It's a Long-time Cramer Fave, But Things Don't Seem Right Here"

AeroVironment, Inc. (NASDAQ:AVAV) is one of the stocks on Jim Cramer’s game plan. Cramer called it a “long-time Cramer fave,” as he said:

We also hear from AeroVironment, and this one’s timely. We have lots of defense stocks just going higher and higher, led by Lockheed Martin. That’s big hardware. By the way, I like RTX, too. If you want drones, though, and I know many of you do, you do buy the stock of AeroVironment. It’s a long-time Cramer fave, but things don’t seem right here.

November of 2024, this company announced a deal to acquire BlueHalo for $4.1 billion to exploit that company’s counter-drone technology as well as its satellite abilities. BlueHalo has a big contract with the Pentagon for satellite work. The stock was pummeled recently, though, when we heard that the contract will be rebid. Now, we gotta find out what’s really happening here. I think AeroVironment has terrific technology, but we need to learn more about BlueHalo because, without that contract, maybe these guys paid too much for the acquisition, and the stock is overvalued. I want to know.

AeroVironment, Inc. (NASDAQ:AVAV) develops robotic and autonomous systems, including uncrewed aircraft, counter-UAS tools, precision-strike solutions, advanced AI, and autonomy. In addition, the company provides space, cyber, communications, and intelligence systems used in defense and commercial applications.

While we acknowledge the potential of AVAV as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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