AeroVironment Inc. (NASDAQ:AVAV) is one of the small caps that have generated significant returns for investors. Its share price soared more than 90% in the last twelve months, and the stock is up 135% in the last three years. AeroVironment shares currently trade around an all-time high of $62 – with the market cap of $1.5 billion.

Stifel analyst Joseph DeNardi issued a ‘Buy’ rating for AeroVironment shares with a $65 price target, saying that the stock is likely to receive support from its business strategies and financial numbers.

AeroVironment Inc. is a supplier of tactical missile systems, unmanned aircraft systems, and other related services to government agencies.

AeroVironment Shares are Up: What is Their Business Strategy?

The company is working on different business strategies to generate sustainable growth in revenues and earnings.

Its business strategy mainly focuses on developing a product portfolio that is based on robotics, software analytics, sensors and connectivity to serve large global markets consisting of telecommunications, defense, and commercial information solutions.

The company has also been making strategic investments to capitalize on opportunities from increasing demand from defense and other industries.

>> Is This the Best Time to Sell Axon Enterprise Shares?

Financial Numbers are Growing at a Robust Pace

AeroVironment reported solid financial numbers for fiscal 2018. Its revenue grew 18% year-over-year in FY2018, supported by growth in its products sales of $35 million combined with a $6.4 million increase from services revenue. The company’s gross margin and income from continuing operations also jumped sharply from the past year.

Strong Order Backlog Indicates Sustainable Revenue Growth

The company continues to experience a strong demand for its products and services. AeroVironment’s funded backlog was standing at around $174.3M at the end of fiscal 2018, significantly higher than last year’s order backlog of $70.9M.

Commenting on the outlook for fiscal 2019, its Chief Executive Officer Wahid Nawabi stated: “As a repositioned, pure-play solutions company with significant growth opportunities across our Unmanned Aircraft Systems and Tactical Missile Systems businesses, we have entered Fiscal 2019 from a position of strength.”

Featured Image: Twitter