RBC lifts PT on US defense firms, citing AI and missile growth
03/07/2025 12:07
** Shares of U.S. Aerospace and defense companies AeroVironment AVAV.O, Karman Holdings KRMN.N and Kratos Defense & Security Solutions KTOS.O all up ~1% in premarket trading ** RBC Capital Market raises PT on AVAV to $275 from $200, KRMN to $51 from $44, and KTOS $50 from $38 ** Brokerage says small-cap defense tech firms are likely to keep outperforming, helped by higher FY26 defense spending and strong positions in fast-growing markets like AI and missiles ** RBC expects FY26 U.S. defense spending growth and a shift to cheaper, disruptive tech benefiting small-cap defense firms over larger contractors ** Up to last close, AVAV, and KTOS stock had risen ~60% and ~64% respectively, and KRMN had fallen ~10.2% YTD
| Companies | Rating | Current PT | Previous PT |
| AeroVironment, Inc | Outperform | $275 | $200 |
| Ducommun Inc | Outperform | $95 | $72 |
| Karman Holdings Inc | Outperform | $51 | $44 |
| Kratos Defense & Security Solutions Inc | Outperform | $50 | $38 |
| Mercury Systems Inc | Sector Perform | $55 | $50 |
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