New York, Jan 9, 2026, 11:05 ET — Regular session
AeroVironment shares were up 4.9% at $362.02 in late morning trade, building on a broader rally in defense names after President Donald Trump proposed lifting the 2027 U.S. military budget to $1.5 trillion. The stock finished the prior session at $344.96.
It’s landing now with the White House pushing a larger budget pitch while leaning on contractors over how they spend cash. Trump has signed an executive order that links dividends, share buybacks and executive pay to weapons delivery schedules, and a Morgan Stanley note dubbed the combination of a record budget proposal and payout limits “carrots and sticks.” reuters.com
Defense stocks have been choppy since Trump’s comments. Still, cash has been rotating into smaller, drone-focused suppliers that investors see as clear winners if spending priorities shift. Reuters reported AeroVironment and Kratos Defense were among the biggest gainers in the latest push higher for the sector.
Parry Labs said on Friday it’s teaming up with AeroVironment to integrate mission computing, software and hardware for the company’s newly developed P550 uncrewed aircraft system (UAS), or drone, built for the U.S. Army’s Long Range Reconnaissance program. “Partnership is central” to meeting the Army’s requirements, Trace Stevenson, president of autonomous systems for AeroVironment, said in the release. PR Newswire
Drone makers also have a Washington angle to watch. The Federal Communications Commission said it will exempt imports of some new models of foreign-made drones and critical components from a December import ban through the end of 2026, and the allowed list includes models from AeroVironment, among others.
Still, the bull case leans on politics and the plumbing, not just the headlines. A Moody’s Ratings analyst warned the $1.5 trillion plan could widen U.S. deficits, and it would still need congressional approval; the Committee for a Responsible Federal Budget estimated the plan would cost $5 trillion through 2035 and add $5.8 trillion to the national debt once interest is included.
On the technicals, the stock has already made a big trip, trading in a 52-week range of $102.25 to $417.86. Friday’s move still left it within reach of the top of that band. Traders were also watching to see if the latest burst of volume would stick through the close.
Next on the list, investors want more clarity on how the administration turns the budget pitch into a formal request and contract pipeline, even as they wait for AeroVironment’s next earnings date. The company hasn’t confirmed anything, but MarketBeat lists an estimated report date of March 3.
