History has just been made out in the depths of space.
I’m talking about an event that could be recorded right alongside Neil Armstrong walking on the moon for the first time.
And it’s massively boosting the strength of an investment thesis that I had previously laid out on January 8.
Of course, I’m talking about the unmanned drone helicopter flight that NASA recently piloted on Mars.
This put the company behind it, the leader in drone technology, at center stage in the space industry, valued at $350 billion.
It’s rare for me to come back and re-recommend a market-crushing tech play in just a few weeks’ time. But, an event like this is big enough to make it worth it.
And it comes on the heels of a dramatic improvement in earnings that should help the stock beat the broad market by more than 70%.
With all of these advantages, this is an investment thesis that’s still getting better all the time…
Reaching for the Stars
As you probably remember, NASA’s latest Mars rover, called Perseverance, landed successfully on the red planet back in February.
This mission marked a lot of firsts in space exploration, and the video of the landing itself made news worldwide.
It’s all receded out of the news by now, as the Perseverance rover begins its less flashy scientific mission.
But attached to the Perseverance rover was a much smaller robot, the first of its kind.
Called Ingenuity, this small drone uses spinning rotors to fly, much like a helicopter does.
Powered flight had never been attempted before outside the confines of Earth’s atmosphere. So, when the solar-powered Ingenuity successfully took off, hovered, and landed safely on April 19, it was truly a first.
No doubt, helicopters have been around for over a century. But flying on Mars is very, very different from doing it here.
First of all, the drone has to be autonomous. It takes about 3 minutes for light to travel from Earth to Mars, way too long for us to be able to remote-control the drone.
Especially as that 3 minutes is the best-case scenario – it’s when Mars and Earth are at their closest point to each other, something that is rare.
In fact, this is a common theme running through some of the most dynamic sectors in the modern economy from cloud computing to e-commerce: Everything depends on strong wireless communications.
That’s why the creation of brand new, faster infrastructure for wireless internet connections here on Earth is giving us twenty stocks projected to multiply their value by ten before the end of 2021.
Now, you can click here to see exactly what I’m talking about.
But back in space, Mars has an atmosphere that’s only 1% as thick as our own. That means spinning rotors generate way less thrust there than they would do back on Earth.
To overcome this, Ingenuity’s rotors spin five-to-10 times as fast as helicopters on Earth do.
So, it’s no wonder, then, that the company behind this one-of-a-kind drone is the leader in its field.
Feet on the Ground
The company I’m talking about is none other than AeroVironment Inc. (AVAV), a pure-play and leader in both military and commercial drones.
The company also has a wide array of flying drones for farmers, wireless companies, and it’s even the Pentagon’s largest supplier of autonomous aerial vehicles.
Of course, not all drones fly. From package delivery to bomb disposal, drones on wheels can be hugely important.
And the company behind the Ingenuity drone is moving heavily into these ground drones as well.
See, Aerovironmnet recently acquired Germany’s leading maker of ground drones, a company called Telerob Gesellschaft für Fernhantierungstechnik mbH.
Telerob has been making unmanned ground vehicles for all manners of defense and security applications going back to 1994, This includes bomb disposal, hazardous materials handling, in-field vehicle repair, and assessment of biological, radiological, and nuclear threats.
In these areas, drones have to be made very sturdy and robust, not to mention smart enough not to endanger humans with their dangerous and often volatile cargo.
There ‘s also no replacing these drones with humans. We are, quite simply, too fragile.
Land and Air
Buying Telerob not only opens up the German defense market to our firm’s aerial drones but also allows it to incorporate Telerob’s ground drone expertise to sell more ground drones here in the States.
In fact, the two companies have already submitted a joint proposal to the U.S. Air Force, and are planning to do the same to the Marine Corps, Navy, Air National Guard, and several U.S. police forces.
AeroVironment doesn’t only design and build drones like the Ingenuity now flying on Mars or the U.S. military’s hand-launched Raven drone.
The company also makes the software that controls these drones and makes them invaluable.
The tiny Raven, for example, can fly itself using built-in AI so that our warfighters in the field can focus on more important matters. Raven provides them with 360° vision in both visible light and infrared, nighttime surveillance, and even secures their communications.
On the commercial side, AeroVironment makes software that helps companies use drones to deliver packages, farmers monitor the health of their crops, and even utility companies remotely inspect the hundreds of miles of high-voltage lines to check for breaks that can cause wildfires.
AeroVironment’s stock has gained 80%. That means it beat S&P 500’s return over the period by 71.3%.
Don’t worry, I still see plenty of upside ahead. In fact, in its most recent quarterly earnings, the company reported an astounding 1,500% increase in per-share profits.
Even if AeroVironment did just 2% of that going forward, their earnings-per-share would double in less than 2.5 years.
So, while humanity’s road to the first powered flight outside of Earth’s atmosphere may have been a long one, your wealth won’t have to wait nearly as long to grow thanks to AeroVironment.
Cheers and good investing,
Michael A. Robinson