{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "AVEX",
  "name": "AEVEX Corp.",
  "url": "https://frontierpicks.com/dossiers/AVEX/",
  "json_url": "https://frontierpicks.com/dossiers/AVEX.json",
  "status": "WATCHLIST",
  "current_conviction": "MEDIUM",
  "archetype": {
    "code": "a4",
    "n": 4
  },
  "current_thesis": "AEVEX's core drone and maritime business is outgrowing its fading Ukraine work, making the shares modestly likely to beat the S&P 500 over three months. First orders under its nearly $400 million drone contract and the 2027 outlook at the fourth-quarter report settle the case.",
  "invalidation_trigger": "A daily close below $11.00, under the 2026-11-13 close of $12.51 and below every close since the third-quarter report, which would show the market rejecting the raised 2026 outlook. Full-year 2026 revenue below the $820 million low end of the guide would also break the case.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "defense-aerospace"
  ],
  "tags": [],
  "sources": [],
  "caveats": [
    {
      "claim": "AEVEX listed on the NYSE on 2026-04-17 after an IPO priced at $20 per share, so its trading history as a public company is short.",
      "source": "AEVEX Corp. Announces Pricing of Initial Public Offering, 2026-04-16",
      "as_of": "2026-04-16"
    },
    {
      "claim": "The listed security is Class A common stock; the company issued 12.7 million Class A shares to the seller of BlackSea as part of the September 2026 acquisition.",
      "source": "AEVEX Q3 2026 earnings call",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Stockholders' equity was $6.5 million at 2026-09-30, so book-value multiples for the shares are extreme.",
      "source": "Form 10-Q for the third quarter of 2026",
      "as_of": "2026-11-12"
    },
    {
      "claim": "Part of 2026 revenue comes from Ukraine-related work that management expects to wind down after the fourth quarter of 2026.",
      "source": "AEVEX Q3 2026 earnings call",
      "as_of": "2026-11-11"
    }
  ],
  "source_links": [
    {
      "title": "AEVEX (AVEX) Q3 2026 Earnings Call Transcript",
      "url": "https://www.fool.com/earnings/call-transcripts/2026/11/12/aevex-avex-q3-2026-earnings-call-transcript/",
      "date": "2026-11-12"
    },
    {
      "title": "AEVEX Q3 2026 slides: core business surges as Ukraine revenue fades",
      "url": "https://uk.investing.com/news/stock-market-news/aevex-q3-2026-slides-core-business-surges-as-ukraine-revenue-fades-93CH-4975854",
      "date": "2026-11-11"
    },
    {
      "title": "AEVEX's Tax-Driven EPS Miss Hides A Revenue Beat And Third Raise, But Shrinking Ukraine Sales Keep The Stock Near Lows",
      "url": "https://finviz.com/news/421336/aevexs-tax-driven-eps-miss-hides-a-revenue-beat-and-third-raise-but-shrinking-ukraine-sales-keep-the-stock-near-lows",
      "date": "2026-11-11"
    },
    {
      "title": "AEVEX Analysts Revise Their Forecasts Following Q3 Results",
      "url": "https://www.benzinga.com/analyst-stock-ratings/price-target/26/11/63187024/aevex-analysts-revise-their-forecasts-following-q3-results",
      "date": null
    },
    {
      "title": "Needham cuts Aevex stock price target to $30 on valuation reset",
      "url": "https://www.investing.com/news/analyst-ratings/needham-cuts-aevex-stock-price-target-to-30-on-valuation-reset-93CH-5021483",
      "date": null
    },
    {
      "title": "AEVEX (NYSE:AVEX) Stock Falls 8.2% Following Weak Earnings",
      "url": "https://www.marketbeat.com/instant-alerts/price-aevex-nyse-avex-stock-falls-82-following-weak-earnings-2026-11-13/",
      "date": "2026-11-13"
    },
    {
      "title": "AEVEX Q3 2026 Earnings Call Transcript",
      "url": "https://www.benzinga.com/news/26/11/63170949/aevex-q3-2026-earnings-call-transcript",
      "date": null
    },
    {
      "title": "AEVEX Corp. Announces Pricing of Initial Public Offering",
      "url": "https://www.businesswire.com/news/home/20260416320184/en/AEVEX-Corp.-Announces-Pricing-of-Initial-Public-Offering/",
      "date": "2026-04-16"
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter revenue was $189.7 million, up 56.5% from a year earlier; adjusted EBITDA was $30.8 million, a 16.2% margin.",
      "source": "AEVEX Q3 2026 results and earnings call",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Full-year 2026 revenue guidance was raised to $820–840 million from $700–720 million; adjusted EBITDA guidance to $128–132 million from $105–111.5 million.",
      "source": "AEVEX Q3 2026 results release",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Third-quarter core revenue was $137.2 million against $52.5 million of Ukraine-related revenue; fourth-quarter Ukraine revenue is projected at about $36.3 million.",
      "source": "AEVEX Q3 2026 earnings slides",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Funded backlog was $444.3 million, including $172.3 million from Maritime Systems, on third-quarter core bookings of $250.2 million.",
      "source": "AEVEX Q3 2026 earnings call",
      "as_of": "2026-11-11"
    },
    {
      "claim": "Third-quarter operating margin was 6.8% against 9.5% a year earlier; gross margin was 28.8% against 25.0%.",
      "source": "Form 10-Q for the third quarter of 2026",
      "as_of": "2026-11-12"
    },
    {
      "claim": "Cash and short-term investments were $79 million and debt $172 million at 2026-09-30, with stockholders' equity of $6.5 million.",
      "source": "Form 10-Q for the third quarter of 2026",
      "as_of": "2026-11-12"
    },
    {
      "claim": "AEVEX was awarded a single-award IDIQ contract for unmanned aircraft systems with a ceiling of nearly $400 million for a US customer.",
      "source": "AEVEX press release",
      "as_of": "2026-11-10"
    },
    {
      "claim": "Needham cut its price target to $30 from $45 with a Buy rating; Piper Sandler raised its target to $15 from $13 with a Neutral rating.",
      "source": "Investing.com and Benzinga analyst reports",
      "as_of": "2026-11-12"
    }
  ],
  "view_changes": [],
  "frame": {
    "as_of": "2026-11-15",
    "business": "AEVEX builds unmanned aircraft, including one-way attack drones, plus maritime systems and mission-support services. It sells them mainly to US defense customers under government contracts and reported third-quarter 2026 revenue of $190 million (Form 10-Q, filed 2026-11-12).",
    "change": {
      "now": "On 2026-11-11 AEVEX raised its 2026 revenue outlook to $820–840 million from $700–720 million, as third-quarter core revenue of $137.2 million overtook $52.5 million of Ukraine-related revenue.",
      "next": "Backlog reached $444 million at 2026-09-30, but cash fell to $79 million against $172 million of debt after the BlackSea deal, and operating margin was 6.8% against 9.5% a year earlier (10-Q, 2026-11-12).",
      "linked": "US defense customers gain a funded drone source under the nearly $400 million contract, which puts AEVEX in competition for the same budgets as AeroVironment (AVAV) and Kratos (KTOS), the listed peers named in IPO coverage."
    },
    "priced_in": "At the 2026-11-13 close (filed inputs to 2026-11-12): market value $746 million, enterprise value $840 million, P/B 114.2 on equity of $6.5 million; EV/sales, EV/EBIT, P/E and free-cash-flow yield are not available. The price holds only if quarterly revenue stays near the $190 million of the 2026-09-30 quarter after Ukraine work ends, at an operating margin of at least that quarter's 6.8%.",
    "links": {
      "customers": [],
      "suppliers": [],
      "competitors": [
        {
          "ticker": "AVAV",
          "url": null
        },
        {
          "ticker": "KTOS",
          "url": null
        }
      ]
    }
  },
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Industrials",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "value_musd": 189.7,
              "yoy_pct": 56.5
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-12",
              "restated": null,
              "value_musd": 201.8,
              "yoy_pct": 99.5
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "value_musd": 121.2,
              "yoy_pct": null
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              "filed": "2026-08-12",
              "restated": null,
              "value_musd": 101.1,
              "yoy_pct": null
            }
          ]
        },
        "gross_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "pct": 28.8
            },
            {
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              "filed": "2026-08-12",
              "restated": null,
              "pct": 23.6
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "pct": 25
            },
            {
              "end": "2025-06-30",
              "filed": "2026-08-12",
              "restated": null,
              "pct": 18.2
            }
          ]
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "pct": 6.8
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-12",
              "restated": null,
              "pct": 7.6
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-12",
              "restated": null,
              "pct": 9.5
            },
            {
              "end": "2025-06-30",
              "filed": "2026-08-12",
              "restated": null,
              "pct": -3.5
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 25
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": -23.9
        },
        "operating_cash_flow": {
          "status": "not available"
        },
        "capital_spending": {
          "status": "not available"
        },
        "free_cash_flow": {
          "status": "not available"
        },
        "diluted_share_change": {
          "status": "not available"
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 78.6
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 172.5,
          "composition": "non-current long-term debt plus current maturities"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": -93.9
        },
        "deferred_revenue": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 46.8,
          "yoy_pct": null
        },
        "backlog": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 444.3,
          "yoy_pct": null
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 124.7
        },
        "inventory": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 20.6
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 6.5
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-12",
          "value_musd": 746.2
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-12",
          "value_musd": 840.1
        },
        "ev_sales": {
          "status": "not available"
        },
        "ev_ebit": {
          "status": "not available"
        },
        "pe": {
          "status": "not available"
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-12",
          "multiple": 114.2
        },
        "fcf_yield": {
          "status": "not available"
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 6.77,
      "days_to_cover": 2.4,
      "change_pct": 12.3
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 0,
          "sold_usd": 59097179.57,
          "bought_unpriced": 5,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\nAEVEX's core drone and maritime business is growing fast enough to replace its fading Ukraine work, which makes the shares modestly more likely than not to beat the S&P 500 over the next three months. The case turns on first orders under the new contract with a ceiling of nearly $400 million and on the 2027 outlook expected with the fourth-quarter report.\n\nThe rating is Medium because the third-quarter report of 2026-11-11 delivered the core growth the case needs. Core revenue was $137.2 million against $52.5 million of Ukraine-related revenue (Q3 2026 earnings slides). Full-year 2026 revenue guidance rose to $820–840 million from $700–720 million, the third raise of the year (company release, 2026-11-11). The rating stops short of High because management has given no 2027 guidance and Ukraine revenue winds down after the fourth quarter.\n\nThe market has handed back much of the report-day gain. Benzinga reported the shares up 11.8% before the open on 2026-11-12, and MarketBeat reported them down 8.2% in the 2026-11-13 session. They closed at $12.51 on 2026-11-13, below the 50-day moving average of $14.02 and down 38.1% over three months on adjusted daily closes.\n\n## Bull Case\n- **Core revenue nearly tripled this year.** Core revenue rose from $49.0 million in the first quarter of 2026 to $137.2 million in the third. The third quarter was the first since the second quarter of 2025 in which core revenue exceeded Ukraine revenue (Q3 2026 earnings slides, 2026-11-11).\n- **Third guidance raise of 2026.** The full-year revenue guide went to $820–840 million, from $700–720 million after the second quarter and $600–620 million after the first. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance rose to $128–132 million from $105–111.5 million (company release, 2026-11-11).\n- **Orders running ahead of revenue.** Third-quarter core bookings were $250.2 million against total revenue of $189.7 million, and funded backlog was $444.3 million at 2026-09-30 (2026-11-11 earnings call). Management put unfunded backlog at $1.1 billion, about $410 million of it expected to become revenue by the end of 2027 (Earnings Whispers, 2026-11-11).\n- **New contract adds visibility.** On 2026-11-10 the company won a single-award indefinite-delivery/indefinite-quantity (IDIQ) contract for unmanned aircraft systems with a ceiling of nearly $400 million. Management expects its margins to match the core Airborne Systems business (2026-11-11 earnings call).\n- **Main segment margins widening.** Airborne Systems revenue rose 67.1% to $147.8 million, with a segment margin of 22.6% against 17.2% a year earlier (Earnings Whispers, 2026-11-11). Gross margin was 28.8% in the quarter against 25.0% a year earlier (Form 10-Q, filed 2026-11-12).\n\n## Bear Case\n- **Ukraine revenue is running off.** Ukraine-related revenue fell from $167.7 million in the first quarter to $52.5 million in the third. Management projects about $36.3 million in the fourth quarter, then a wind-down (Q3 2026 earnings slides, 2026-11-11).\n- **Total revenue down three quarters running.** Total revenue went from $216.7 million in the first quarter to $201.8 million in the second and $189.7 million in the third (Earnings Whispers, 2026-11-11).\n- **Operating margin below a year ago.** The 10-Q filed 2026-11-12 shows a third-quarter operating margin of 6.8%, against 9.5% a year earlier. Selling, general and administrative costs more than tripled to $29.3 million, and Global Solutions' segment margin fell to 5.4% from 14.3% (Earnings Whispers, 2026-11-11).\n- **Tax charge and a thin balance sheet.** Pre-tax income of $25.0 million turned into a loss after a $41.7 million tax provision, $37.9 million of it a one-time deferred tax expense tied to the BlackSea acquisition. The loss was $0.40 a share against a $0.07 profit estimate (Benzinga, 2026-11-11). At 2026-09-30 the company held $79 million of cash against $172 million of debt, with equity of $6.5 million (Form 10-Q).\n- **Half the raise is acquired.** Management said roughly half the increase at the guidance midpoint came from BlackSea, the maritime business that closed on 2026-09-08. The deal was paid for partly with 12.7 million new Class A shares and a $75 million term-loan draw (2026-11-11 earnings call).\n- **Analysts split on value.** On 2026-11-12 Needham kept a Buy rating and cut its target to $30 from $45. Piper Sandler kept a Neutral rating and raised its target to $15 from $13 (Investing.com; Benzinga).\n\n## Setup & Price Structure\nThe shares listed on the New York Stock Exchange on 2026-04-17 after the initial public offering (IPO) priced at $20 on 2026-04-16. They closed at $12.51 on 2026-11-13, well below the IPO price.\n\nOn adjusted daily closes the shares are down 38.1% over three months, and the 50-day moving average stood at $14.02 at the 2026-11-13 close. The report lifted the shares in the 2026-11-12 session, and the 8.2% decline reported by MarketBeat on 2026-11-13 gave back much of that move. A sustained close back above the 50-day average would show the market accepting the raised outlook. A further slide toward the pre-report trading range would show it discounting the core growth.\n\n## Catalyst Calendar\n\n- **~2026-12-31 (est.):** First task orders under the nearly $400 million unmanned aircraft systems IDIQ. Management expects orders late in 2026 but said timing may slip. Funded orders would turn the contract ceiling into backlog behind 2027 core growth.\n- **~2027-03-15 (est.):** Fourth-quarter and full-year 2026 report, with any 2027 outlook. Shows whether full-year revenue lands inside the $820–840 million guide and whether core and maritime growth can offset the end of Ukraine-related revenue in 2027.\n\n## What Would Change Our Mind\n\nA daily close below $11.00, under the 2026-11-13 close of $12.51 and below every close since the third-quarter report, which would show the market rejecting the raised 2026 outlook. Full-year 2026 revenue below the $820 million low end of the guide would also break the case.\n\nThe risks this note tracks, each with what would confirm it:\n\n- The end of Ukraine-related revenue leaves 2027 total revenue below 2026 levels. Confirmed by: A 2027 outlook at the fourth-quarter report that implies total revenue below the 2026 guidance range.\n- US budget delays under a continuing resolution push orders out and slow bookings. Confirmed by: No funded orders under the nearly $400 million IDIQ by the fourth-quarter report, and fourth-quarter core bookings below core revenue.\n- Maritime Systems backlog runs off as BlackSea sustainment work ends. Confirmed by: Maritime Systems funded backlog reported below $172.3 million at the fourth-quarter report.\n- Acquisition financing raises leverage or adds share dilution on a balance sheet with $6.5 million of equity. Confirmed by: A draw on the $200 million revolver or a new equity issuance disclosed in a filing before the fourth-quarter report.\n- Supply-chain shortages in cameras, radios and engines, flagged by management on 2026-11-11, cap drone deliveries. Confirmed by: Fourth-quarter Airborne Systems revenue below the third quarter's $147.8 million with management citing component shortages.\n\n## Correlation Notes\nMost revenue comes from US Department of War customers, so the shares respond to US defense budget news. Management warned that a continuing resolution running into February or March 2027 could delay awards, and it now sees reconciliation funding as unlikely (Earnings Whispers, 2026-11-11). Ukraine-related revenue ties part of 2026 results to US support for Ukraine, a link that fades once that work ends after the fourth quarter. Coverage of the April 2026 IPO named AeroVironment (AVAV) and Kratos Defense & Security Solutions (KTOS) as the listed comparables, so the shares share drone-budget news with those names. Company-specific results have driven the shares more than the broad index since listing.",
  "first_seen": "2026-11-12",
  "last_analyzed": "2026-11-15T12:25:31+00:00",
  "last_synthesized": "2026-11-15",
  "date_modified": "2026-11-15",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}