One-glance verdict
Undervalued
$20.65 our estimate vs market $7.24
Wall Street consensus: $16.50 (-20.1% lower than our fair-value estimate)
65% below our estimate, below the bear case
Fundamentals snapshot
AIRO Group Holdings, Inc.
AIRO · NGM · Industrials · Aerospace & Defense
Current price
$7.24
52-week range
$5.71 - $22.47
Market cap
$228.46M
Balance sheet
Healthy
-2.94x Concerning
Net cash $16.01M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
1 Risk
2 rewards · 1 risks
- Reward Revenue grew 17.3% last year.
- Reward Free cash flow was positive in 2/10 years.
- Risk Return on equity was -3.6% last year — the company lost money on shareholders' equity.
What this company does
AIRO Group Holdings, Inc.
AIRO Group is an aerospace and defense company that makes money in a few different ways, primarily by selling drones and providing military pilot training services. The company also builds and sells avionics (the electronic "brains" of an aircraft, like flight displays and GPS) and is developing a new type of electric aircraft designed to carry cargo. Because its business is spread across manufacturing, services, and new technology development, it has several ways to grow and isn't dependent on just one product.
How the company got here
AIRO Group Holdings was officially formed in 2021 with a specific strategy: to buy and bring together several existing companies in the aerospace and defense industry. Instead of starting from scratch, it acquired established businesses with expertise in areas like drones, aircraft electronics, and pilot training. To raise money and sell its stock to the public, AIRO chose to merge with a Special Purpose Acquisition Company, or SPAC (a company that is already listed on a stock exchange and exists solely to buy another company). This move allowed AIRO to become a publicly traded company on the Nasdaq stock exchange more quickly than through a traditional Initial Public Offering (IPO).
What it actually does
AIRO Group operates in the aerospace and defense industry, which means it builds and sells technology for aircraft and military use. Think of it as a company that brings together different high-tech aviation businesses under one roof. Its products range from unmanned drones and the electronic brains that help pilots fly (known as avionics) to training services for military pilots. The company is also working on developing a new type of electric aircraft that can take off and land like a helicopter.
Drones
This part of the company builds and sells unmanned aerial systems, more commonly known as drones. These aren't the small drones you might see in a park; they are sophisticated aircraft used for military and commercial jobs like surveillance, mapping, and tracking. The customers are typically government and defense organizations. This segment is a major focus for the company, with a large backlog (the total value of confirmed orders from customers that have not yet been delivered) of over $150 million.
Avionics
The Avionics segment, operating under the well-known brand Aspen Avionics, makes the electronic systems used in aircraft cockpits. This includes things like flight displays, navigation equipment, and GPS sensors that pilots in both military and private planes rely on to fly safely. These components are sold to aircraft manufacturers and owners to be installed in new planes or to upgrade older ones. This business provides critical technology for a wide range of aircraft, from general aviation planes to advanced drones.
Training
This division provides highly specialized training services for military pilots and personnel. This includes setting up simulated combat situations, teaching pilots how to support ground troops, and providing intelligence and surveillance training. Essentially, governments and defense agencies pay AIRO to help their pilots and teams get the real-world experience they need for complex missions. The company has mentioned it is evaluating the future role of this division as it focuses more on other areas.
Electric Air Mobility
This is AIRO's most forward-looking business, focused on developing a new type of aircraft called an eVTOL (electric Vertical Take-Off and Landing). Through its Jaunt Air Mobility brand, the company is designing a rotorcraft that takes off and lands vertically like a helicopter but is powered by electricity, intended for applications like transporting cargo. This is a small but potentially high-growth part of the company, betting on the future of transportation in and around cities. The company's revenue forecasts are partly based on the future delivery of these vehicles.
What management is betting on now
Management is currently focusing heavily on its military drone business, aiming to become a key supplier for the U.S. and its allies. A major priority is converting its large drone backlog (the value of products ordered but not yet delivered) into actual sales and revenue. The company is also investing in developing new AI-powered drones and hopes to get a special 'Blue UAS' certification, which would make it easier to sell to the U.S. Department of Defense. This strategic shift emphasizes near-term opportunities in the defense market while continuing to develop its future-focused electric aircraft.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$5.28M
FY2024 Q4
$23.70M
FY2025 Q1
$-10.10M
FY2025 Q2
$-21.72M
FY2025 Q3
$-6.71M
FY2025 Q4
$3.02M
FY2026 Q1
$-19.48M
FY2026 Q2
$-33.75M
Revenue
$43.18M
Net income
$-1.99M
Diluted EPS
-0.06
Operating cash flow
$-31.32M
Free cash flow
$-33.75M
Fetching…
Sources
Revenue
$8.90M
Net income
$-15.45M
Diluted EPS
-0.49
Operating cash flow
$-17.40M
Free cash flow
$-19.48M
Fetching…
Sources
Revenue
$48.28M
Net income
$-39.41K
Diluted EPS
-0.07
Operating cash flow
$4.09M
Free cash flow
$3.02M
Fetching…
Sources
Revenue
$6.28M
Net income
$-7.96M
Diluted EPS
-0.28
Operating cash flow
$-5.77M
Free cash flow
$-6.71M
Fetching…
Sources
Revenue
$24.55M
Net income
$5.87M
Diluted EPS
0.30
Operating cash flow
$-21.00M
Free cash flow
$-21.72M
Fetching…
Sources
Revenue
$11.79M
Net income
$-1.97M
Diluted EPS
-0.12
Operating cash flow
$-9.75M
Free cash flow
$-10.10M
Fetching…
Sources
Revenue
$86.94M
Net income
$-38.69M
Diluted EPS
-2.36
Operating cash flow
$23.94M
Free cash flow
$23.70M
Fetching…
Sources
Revenue
$23.69M
Net income
$-30.33M
Diluted EPS
-1.85
Operating cash flow
$5.38M
Free cash flow
$5.28M
Fetching…
Sources
Is it cheap or expensive?
Fair value $20.65 vs current price $7.24
Wall Street consensus is the average analyst price target: $16.50 (-20.1% lower than our fair-value estimate).
Our most-likely fair value is $20.65 a share — about 185.2% above today's price of $7.24, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $16.0M - more cash than debt. Interest coverage -2.9x.
Net debt
$-16.01M
Interest coverage
-2.94x
AIRO Group Holdings, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 5 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
AIRO
BASELINE
AIRO Group Holdings, Inc.
Total debt $9.84M Interest coverage -2.94x This is the baseline the peer rows are being compared against.
Total debt $3.93M Interest coverage -663.77x Neither company has much profit cushion over interest right now.
Total debt $160.01K Interest coverage -19.09x Neither company has much profit cushion over interest right now.
Total debt $14.87M Interest coverage -970.67x Neither company has much profit cushion over interest right now.
Total debt $1.15M Interest coverage -310.70x Neither company has much profit cushion over interest right now.
Total debt $308.88M Interest coverage -22.23x Neither company has much profit cushion over interest right now.
What you should know
The case for and against AIRO
2 Rewards
1 Risk
Rewards
-
Revenue grew 17.3% last year.
-
Free cash flow was positive in 2/10 years.
Risks
-
Return on equity was -3.6% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-11.22x
P/B
0.32x
P/S
2.14x
EV/EBITDA
-22.89x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
58.6%
Operating margin
3.8%
Net margin
-23.9%
ROE
-3.6%
ROA
-1.8%
Health
Liquidity and balance-sheet strength
Debt / equity
0.01x
Current ratio
2.87x
Quick ratio
2.19x
Total debt
$9.84M
Total cash
$25.85M
Growth
How the business has been compounding
Revenue TTM
$106.64M
Revenue 5Y CAGR
—
EPS TTM
-0.95
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$-50.40M
Free CF TTM
$-35.51M
FCF margin
-33.3%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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