#7 - Redwire (NYSE:RDW)
The last defense stock on this list is a penny stock, that is, a stock currently trading for less than $5 per share. Redwire (NYSE: RDW) is a small-cap stock with a market cap of around $184 million. That will only add to the stock's volatility.
Redwire is a stock to watch if you're interested in the space niche. That's because, unlike many of the other companies on this list that operate in many areas, Redwire is, for now, exclusively in the space sector. However, according to McKinsey, this is an area that is growing at approximately 9% annually.
Like many penny stocks, Redwire has volatile movement, has higher than usual short interest and is not widely covered by analysts. Before taking a position, investors should also be aware that, as of November 2023, Redwire is not yet profitable.
Putting that aside, the 3 analysts that do offer a rating give RDW stock a Strong Buy rating with a price target of $7.50, which is 160% higher than the stock's current price.
About Redwire
Redwire Corporation provides critical space solutions and space infrastructure for government and commercial customers in the United States, Europe, and internationally. The company provides avionics and sensors including star trackers, sun sensors, critical for navigation, and control of spacecraft; camera systems; solar array solutions for spacecraft spanning the spectrum of size, power needs, and orbital location; and strain composite booms, coilable booms, truss structures, telescope baffles, and deployable booms to position sensors or solar arrays away from the spacecraft.
Read More - Current Price
- $13.17
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 4 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $8.55 (35.1% Downside)
Just a few months ago, defense stocks were trading near 52-week lows. Today, many of the stocks listed in this presentation are trading near 52-week highs. Much of that growth has occurred since the terrorist attack on Israel.
However, if the current rally in stocks broadens to other sectors, it could pull money out of defense stocks and into other sectors. That could make investors skittish about "chasing" these stocks higher.
That would appear to be short-sighted. The market is still seeking direction, and the long-term outlook for defense stocks is bullish. This may be the beginning of a multi-year bull market in the sector.
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