Drone stocks gained major investor attention in 2020 during a period of fed easy money policies.
This led small cap growth stocks like E Hang and Drone Delivery Canada to soar to record levels.
However, sentiment had soon shifted in 2021 as record high inflation decimated unprofitable growth companies.
Many investors are left wondering if drone stocks were just a fad, or are they here to stay?
According to Grand View Research, the commercial drone market was last valued at $29.86 billion. It is projected to grow at a compound annual growth rate (CAGR) of 38.6% from 2023-2030 (Grand View Research, 2022).
That is certainly impressive growth, which may leave a potential untapped opportunity for investors.
As inflation continues to albeit, now might be a good time to explore sectors with explosive growth potential over the next decade.
Below, we will present the 7 Best Drone Stocks to watch in 2023!
- Amazon
- AeroVironment
- Boeing
- Kratos Defense & Security Solutions
- Northrop Grumman Corporation
- Ehang Holdings
- Drone Delivery Canada Corporation
1. Amazon (NASDAQ: AMZN)
- Ticker: AMZN
- Dividend Yield: N/A
- Market Cap: $1.05 Trillion
Amazon is an American multinational technology company headquartered in Seattle, Washington, United States.
They are one of the largest companies in the world by market capitalization.
Amazon has its feet in every sector on the planet, and is currently the largest online retailer in the world.
Some of the company’s wholly owned subsidiaries include; Amazon AWS, Amazon Fresh, Whole Foods Markets, Ring, Amazon Air, Amazon Robotics, and Amazon Pharmacy.
As the world’s largest online retailer, known for its superior delivery service Amazon Prime, it is no surprise that Amazon will explore drone delivery technologies.
As a result, Amazon should be at the top of the list for best drone stocks to buy in 2023.
2. AeroVironment (NASDAQ: AVAV)
- Ticker: AVAV
- Dividend Yield: N/A
- Market Cap: $2.73 Billion
AeroVironment is an American defense contract company headquartered in Arlington, Virginia, United States.
The company is commonly known for their solar-powered vehicles.
However, AeroVironment is the U.S. military’s top supplier of small drones. Their drones include the Raven, Puma, Switchblade, and Blackwing.
Most recently, the company cited the importance of their drone technology (Switchblade Suicide) and how it has benefited the Ukrainians during the war.
With growing demand for advanced drone technology and rising geopolitical tensions across the globe, AeroVironment’s dependable technology makes it a top drone stock to buy for 2023.
3. Boeing (NYSE: BA)
- Ticker: BA
- Dividend Yield: N/A
- Market Cap: $127.97 Billion
Boeing is an American multinational company headquartered in Arlington, Virginia, United States.
The company is most commonly known as a commercial jet manufacturer.
Boeing also designs and manufactures rockets, satellites, missiles, and telecommunications equipment. They are the world’s third largest defense contractor by revenue.
Their drone subsidiary, Insitu, is a leading manufacturer of drone UAVS for the U.S. Navy.
Boeing is no stranger to defense and advanced military technology. As a leading manufacturer of critical military infrastructure for the Pentagon, Boeing is a drone stock all investors should keep on their radar.
4. Kratos Defense & Security Solutions (NASDAQ: KTOS)
- Ticker: KTOS
- Dividend Yield: N/A
- Market Cap: $1.65 Billion
Kratos Defense & Security Solutions is an American cyber-security, weapons and technology company headquartered in San Diego, California, United States.
The company specializes in directed-energy weapons, satellites, missile defense and combat systems.
Kratos is currently developing advanced aerial systems for air, land and seas. This includes tactical UAVs, small UAS swarming, and aerial targets.
In July 2011, Integrated Systems merged with Kratos. At the time, Integrated Systems had more than 800 employees. Since the merger, Kratos has made a number of different acquisitions.
Kratos is a leading defense technology company, with the U.S. Department of Defense as one of its key customers. With growing demand for defense technology and advanced cyber-security solutions, Kratos is a top drone stock to buy in 2023.
5. Northrop Grumman (NYSE: NOC)
- Ticker: NOC
- Dividend Yield: 1.46%
- Market Cap: $72.57 Billion
Northrop Grumman Corporation is an American multinational aerospace and defense company headquartered in Falls Church, Virginia, United States.
The company specializes in aeronautical systems, defense systems, space systems and mission systems.
Northrop Grumman is the world’s largest weapons manufacturer and developer of military technologies.
Their drone program includes a number of different autonomous, advanced military technologies. It includes the Global Hawk, Skyborg, and the Bat Unmanned Aircraft System (UAS).
Northrop Grumman is a leader in aerospace, defense and military technologies. This makes them uniquely positioned for advanced drone innovations, autonomous air systems and deployment.
6. Ehang Holdings (NASDAQ: EH)
- Ticker: EH
- Dividend Yield: N/A
- Market Cap: $620 Million
Ehang Holdings is a Chinese autonomous aerial vehicles and technology company headquartered in Huangpu, Guangzhou, China.
The company is primarily known for their autonomous aerial vehicles.
Apart from the design and manufacturing of their aerial vehicles, Ehang operates a smart logistics platform delivering goods to rural and urban areas.
Ehang has already collaborated with companies like DHL, which is a multinational logistics company based in Germany.
The company is growing its revenue more than 50% year-over-year, and most recently completed its first passenger carrier flight in Japan.
Ehang is still a small company with a market cap under $1 billion. With the company being based in China, it adds an extra layer of risk. However, Ehang’s technology does have a lot of potential and it should be kept on investors’ radar.
7. Drone Delivery Canada Corporation (TSXV: FLT.V)
- Ticker: FLT.V
- Dividend Yield: N/A
- Market Cap: $103 Million
Drone Delivery Canada Corporation is a Canadian drone and logistics company headquartered in Ontario, Canada.
The company specializes in aerial drone technology and logistics.
Drone Delivery Canada’s primary customer sectors it serves are airports, couriers, healthcare, mining, oil & gas, industrial and remote communities.
Their proprietary drone logistics software, Flyte, provides turnkey logistics solutions for autonomous cargo delivery. They became the first drone company in Canada to be certified as a ‘’Compliant Operator’’ by Transport Canada.
Drone Delivery Canada is still a small company in its early stages with a market cap of only $100 Million. This means the company is extremely risky, but their growth prospects still look promising.
If you’re Canadian looking to invest into drone stocks, Drone Delivery Canada should be kept on your radar in 2023.
Investing In Drone Stocks: Is Now The Time To Buy?
Drone stocks have lost their buzz, but are beginning to pick up investor attention again.
As many unprofitable companies have come back down to reality, investors begin to search for areas of the market that may outperform over the next decade.
It is no surprise that investors are also considering defense stocks to add an extra layer of protection to their investment portfolios. With Russia’s War in Ukraine, and rising geopolitical tensions between China and Taiwan, now might be a great time to consider investing in drone stocks.
Disclosure: The author holds no position mentioned in this article. Freedom Stocks has a disclosure policy.
