8 Best Small Cap Defense Stocks to Buy Now

2. Astronics Corporation (NASDAQ:ATRO)

Market Cap: $585 million

Number of Hedge Fund Holders: 22

Astronics Corporation (NASDAQ:ATRO) is an American company that provides advanced technologies to clients in the global aerospace, defense, and electronics industries. Some of its offerings include lighting and safety systems, aircraft electronics integration, automated test systems, and distribution and motion systems, among other products and services.

In June, Astronics Corporation (NASDAQ:ATRO) secured a $215 million contract for the production of the U.S. Army Radio Test Set TS-4549/T. Under the agreement, the company would be responsible for program management, engineering, and manufacturing of the product to support the operational readiness of American troops’ radio communication devices.

The contract will run for five years and includes an initial delivery order of $15.5 million to cover qualification requirements. At the time of the agreement, Astronics Corporation (NASDAQ:ATRO) expected between $10 million and $12 million of revenue to be realized during the fiscal year 2024.

On November 6, the company announced financial results for the third quarter of 2024. Sales increased 25% year-over-year to $203.7 million, which is the highest quarterly revenue since Q1 2019. Adjusted EBITDA was posted at $27 million, which represented 13% of sales. This was a 207% improvement from the prior year and was led by a strong performance by the aerospace segment, whose sales grew 25% for the quarter and 19% for the year.

Net loss for the quarter was at $11.7 million, or 34 cents per diluted share, and included the impact of $7 million worth of refinancing costs. This was an improvement from the net loss of $17 million during the same period last year. Looking ahead, Astronics Corporation (NASDAQ:ATRO) is encouraged by strong demand and is entering the fourth quarter with a backlog of $612 million, which sets it up for continued improvements in financial results toward the end of the year and the beginning of 2025.

According to Insider Monkey’s database for Q3 2024, 22 hedge funds had investments in the company, up from 19 at the end of the second quarter. Astronics Corporation (NASDAQ:ATRO) is among the best small cap defense stocks to buy now.