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These 3 Drone Stocks Could Fly to Higher Highs
We've been pounding the table over drone stocks for months and the market has started to agree.
Back in late August, we highlighted opportunities in three red-hot names:
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AeroVironment (SYM: AVAV), which surged from the mid-$200s to the high-$200s
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Ondas Holdings (SYM: ONDS), which more than doubled off its lows
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Draganfly (SYM: DPRO), which posted a sharp, momentum-driven move
Those were big runs but we think they may prove to be only the early innings of a much larger cycle.
Why? Because drones aren't a "cool tech trend" anymore. They're quickly becoming core infrastructure for (1) modern defense and deterrence, (2) border and critical-infrastructure security, and (3) commercial operations ranging from inspection to emergency response to logistics. And at the policy level, Washington is now signaling that it wants the United States to lead the global drone economy, not follow it.
That's the setup for a multi-year demand tailwind that can turn the right drone companies into genuine growth stories.
The drone boom is being pulled forward by policy (not just hype)
A major reason we're constructive here is that the current administration's posture is unusually explicit: accelerate deployment, scale domestic supply, and clear regulatory bottlenecks that have historically slowed adoption.
1) "Unleashing American Drone Dominance" is a direct catalyst for commercialization.
In June 2025, the White House issued an executive order focused on accelerating safe commercialization, expanding routine drone operations, scaling U.S.-based production, and boosting exports of "trusted, American-manufactured" drone technologies. In plain English: the administration wants drones to become normal - and wants American companies to be the primary beneficiaries.
Crucially, the same order puts emphasis on Beyond Visual Line of Sight (BVLOS), the single biggest unlock for commercial scale. If drones must stay within an operator's visual range, the market remains niche. If BVLOS becomes routine under a clear regulatory framework, the market expands dramatically.
2) The Pentagon is explicitly pushing speed, scale, and "Buy American."
In July 2025, Defense Secretary Pete Hegseth issued a directive aimed at accelerating procurement and fielding of drone systems - especially affordable, widely deployable platforms. The theme is clear: reduce bureaucratic drag, approve more U.S. products for purchase, and push capability down to frontline units faster than traditional defense procurement cycles allow.
That matters because the "drone era" isn't about a handful of exquisite systems. It's about quantity, iteration speed, and production capacity - and that plays directly into the strengths of certain U.S. drone manufacturers.
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3) Funding is lining up behind modernization priorities.
The administration's broader legislative and budget posture is increasingly supportive of defense modernization. For example, the One Big Beautiful Bill Act (H.R. 1 / P.L. 119-21) established substantial FY2025 defense funding across key modernization buckets. Among other items, it included dedicated categories for munitions and supply chain resiliency and for scaling low-cost weapons into production, exactly the kind of framing that tends to support drones, autonomous systems, and attritable platforms.
Even when legislation doesn't name a specific company, it often creates the "budget gravity" that pulls programs forward - and when procurement is being streamlined at the same time, the translation from appropriations to orders can happen faster.
4) BVLOS rulemaking is moving from "pilot programs" to "default operations."
In August 2025, U.S. Transportation Secretary Sean Duffy unveiled a proposed BVLOS rule designed to safely integrate unmanned aircraft systems into the National Airspace System, reducing the need for one-off waivers and exemptions that have historically slowed adoption.
This is not a small deal. BVLOS is the difference between:
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A drone that can inspect a single site
and
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A drone network that can monitor pipelines, borders, utilities, rail lines, and large industrial campuses continuously.
5) Security policy is tilting demand away from foreign-made systems.
Another accelerant is the ongoing shift toward restricting or discouraging foreign-made drones and components in sensitive use cases. In late 2025, the FCC announced a ban on the sale of new foreign-made drones (including certain Chinese manufacturers), citing national security risks. That type of policy pressure can rapidly re-route procurement toward U.S.-aligned suppliers; particularly across government, public safety, and critical infrastructure.
Put it all together and the message is straightforward: demand is real, regulatory friction is being reduced, and policy incentives are skewing toward domestic providers.
That's why we believe the best-positioned drone stocks could still have substantial upside.
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The 3 drone stocks we're watching
Company: AeroVironment (SYM: AVAV)
The established leader with real defense pull-through
AeroVironment is one of the most recognizable U.S. names in small drones and loitering munitions, with platforms that fit directly into the modern battlefield's "cheap, fast, and effective" playbook.
Its Switchblade loitering munition systems are a prime example of where defense demand has been heading: portable, precise, and operationally flexible. The company has also been publicly associated with the Pentagon's broader push toward rapidly fielding autonomous and uncrewed systems.
Why it matters now: If procurement timelines compress and "Buy American" becomes more than a slogan, established domestic suppliers with production capacity and battlefield-relevant products can be first in line.
What to watch: contract momentum, production scaling, and any updates tied to DoD modernization initiatives.
Company: Ondas Holdings (SYM: ONDS)
Autonomy + counter-drone exposure in one package
Ondas has evolved into a more direct drone-and-autonomy story through its Ondas Autonomous Systems business, which includes platforms focused on persistent operations and security use cases.
Two areas stand out:
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Autonomous "drone-in-a-box" systems designed for repeatable missions with limited human intervention
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Counter-UAS solutions, which are increasingly essential as drones proliferate (because the more drones in the sky, the more demand there is for protection against hostile or unauthorized drones)
Ondas is a higher-volatility name than AVAV, but it's also the kind of profile that can move fast when policy and procurement tailwinds show up, especially if it continues to announce meaningful orders and deployments.
Why it matters now: BVLOS normalization and heightened critical-infrastructure security demand can dramatically expand the addressable market for autonomous operations.
What to watch: order flow, margin trajectory, and how quickly the company converts pilots and initial deployments into recurring programs.
Company: Draganfly (SYM: DPRO)
The speculative "torque" play
Draganfly is smaller and more speculative... but that's exactly why it can offer the most torque in a risk-on tape.
The company has pushed into practical, high-need categories like public safety, emergency response, and defense-adjacent use cases. It's also the type of name that can benefit disproportionately if BVLOS becomes more routine and if government-adjacent procurement shifts further toward domestic suppliers.
Why it matters now: in early-stage drone names, even modest contract wins or new program traction can re-rate the stock quickly.
What to watch: recurring revenue progress, contract announcements, and any evidence of scale economics (because small-cap drone names can rally hard, but they must eventually prove durability).
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