The 7 best drone stocks to buy represent several companies that manufacture drones and other tech products. There aren’t many fully-established companies focused solely on drones and most of them are privately-held or start-ups that haven’t gotten around to filing for an IPO yet.
Drones, or as they are officially called, unmanned aerial vehicles (UAVs), have been gaining in popularity as developments in technology have made them more affordable, better equipped, and easier to handle for regular users (take a look at the 7 Easiest to Fly and Cheapest Drones for GoPro for examples). In this way there are drones that can be used in agriculture for crop dusting and data analysis of fields and orchards (they usually detect the soil humidity, parasite infestation, and other data that is crucial in farming), drones used for photography, which are more common, and drones for recreational use, among other segments. Lately, some companies like Amazon.com, Inc. (NASDAQ:AMZN) and Alphabet Inc (NASDAQ:GOOGL) have been exploring the usage of drones to deliver small packages, although the technology is still in very early stages.
However, drones have been around for over a century, although they were used mostly by the military. The U.S military used UAVs as early as 1918, having launched the “Kettering Bug”, which was a sort of flying bomb. Over the 20th century the military usage of drones progressed and included reconnaissance and surveillance drones that were developed during the Cold War period. Lately, the usage of drones in the military has been more common, with the Central Intelligence Agency overseeing a targeted killing program that uses drones to strike individuals in different countries, including Afghanistan, Pakistan, Yemen, and Libya. According to some estimates, the Pentagon has around 7,000 aerial drones, significantly more than the 50 it had had ten years earlier. Its 2016 budget included $2.9 billion for drone research and development.
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Nevertheless, as stated earlier, among civilians drones only became popular a couple of years ago. However, their sales have skyrocketed and drones started to represent a threat to the public and to aviation, which prompted the FAA to release safety rules and to enforce mandatory registration of drones. Earlier this year, the FAA even launched a new Aviation Rulemaking Committee to tackle the security concerns of growing drone usage. In 2016, there were 1.1 million drones in the U.S.
There are dozens of companies that are manufacturing drones and as their usage in the areas of agriculture and deliveries becomes more widespread, many companies, including the best drone stocks to buy, should find their niches and thrive in them. According to BI Intelligence, there will be 29 million consumer drones sold in the U.S by 2021, as well as 805,000 commercial drones.
Having said that, let’s take a closer look at the 7 best drone stocks to buy, beginning on the second page of this article.
7. Intel Corporation (NASDAQ:INTC)
Intel Corporation (NASDAQ:INTC) is mostly engaged in the manufacturing of semiconductors, but it has many other segments, one of which is drones. You can’t currently buy an Intel Corporation (NASDAQ:INTC) drone, but last year it unveiled the Shooting Star, a quadrocopter drone that is used in light shows. Intel Corporation (NASDAQ:INTC) uses swarms of these drones to create images in the sky and lightshows, with each drone being fitted with an LED light that can shine in 4 billion color combinations. Also last year, Intel Corporation (NASDAQ:INTC) announced the Falcon 8+ commercial drone.
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6. Ambarella Inc (NASDAQ:AMBA)
Ambarella Inc (NASDAQ:AMBA) doesn’t make drones at all, yet it deserves a spot on our list of the best drone stocks to buy. That is because Ambarella Inc (NASDAQ:AMBA) is the main supplier of chips to many other drone makers, including dji, which is the largest drone manufacturer and GoPro Inc (NASDAQ:GPRO).
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5. GoPro Inc (NASDAQ:GPRO)
GoPro Inc (NASDAQ:GPRO) entered the drone market last year, when it unveiled the Karma drone, which was released earlier this year. The maker of well-known action cameras had a rough start in the new market, as the Karma had a battery flaw and was recalled a few months after release. Nonetheless, in August, GoPro Inc (NASDAQ:GPRO) said that Karma is the second best-selling drone brand in the U.S.
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4. Northrop Grumman Corporation (NYSE:NOC)
On the fourth spot on the list of the best drone stocks to buy is Northrop Grumman Corporation (NYSE:NOC). As an aerospace and defense technology company, Northrop Grumman Corporation (NYSE:NOC) also develops drones. One of its products is the RQ-4 Global Hawk, a surveillance aircraft that uses a high-resolution synthetic aperture radar and long-range electro-optical sensors. In addition, Northrop Grumman Corporation (NYSE:NOC) has the MQ-8 Fire Scout, which is an unmanned autonomous helicopter which provides reconnaissance, situational awareness, aerial fire support and precision targeting support.
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3. Lockheed Martin Corporation (NYSE:LMT)
Lockheed Martin Corporation (NYSE:LMT) is also engaged in aerospace, defense, security, and advanced technologies and is the largest defense contractor in the world. Among Lockheed Martin Corporation (NYSE:LMT)’s UAVs is the RQ-170 Sentinel, which is operated by the US Air Force for the Central Intelligence Agency. It is thought that the RQ-170 Sentinel is a stealth aircraft, but the USAF doesn’t provide many details regarding its specifications and pictures of the drone itself are very rare.
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2. Boeing Co (NYSE:BA)
Boeing Co (NYSE:BA) is a global aviation company, so it’s not surprising that it also makes drones, such as the Phantom Eye, a liquid-hydrogen fueled high-altitude and long-endurance aircraft for long surveillance missions. In addition, Boeing Co (NYSE:BA) recently bought Aurora Flight Sciences, which is engaged in the manufacturing of electric airplanes, vertical-take-off-and-landing airplanes and UAVs. It is speculated that Boeing Co (NYSE:BA) plans to use Aurora to get into the flying taxis business, given that Uber has been working with it to develop UAVs capable of carrying passengers and of vertical take-off and landing.
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1. AeroVironment, Inc. (NASDAQ:AVAV)
AeroVironment, Inc. (NASDAQ:AVAV) is the largest supplier of small drones to The Pentagon, with models like the Raven, Wasp, and Puma. The company has a five-year contract from the US Air Force Research Laboratory worth $4.7 million to develop advanced propulsion technologies for UAVs. AeroVironment, Inc. (NASDAQ:AVAV) is currently developing the Nano Hummingbird, which is a tiny drone that looks like a hummingbird and is equipped with a video camera capable of surveillance and reconnaissance.
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These are the 7 best drone stocks to buy. There are many other large companies that make drones, such as dji, which is the largest manufacturer of drones and the most popular drone brand, but the Chinese company is only just exploring an IPO path. Other well-known drone makers include Yuneec, which offers a good toy-class drone in addition to high-end drones equipped with cameras, and Parrot, a French company that has a wide selection of drones. Among military drone manufacturers, there is General Atomics, a privately-held company that makes the Reapers, Predators and Grey Eagles, all of which are widely used by the U.S military.
Disclosure: None
