Trump Threatens Buyback Ban, Proposes $1.5 Trillion Military Budget Increase
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 11 2026
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Source: Yahoo Finance
- Defense Stock Volatility: Trump's threat to ban stock buybacks and dividends for defense contractors led to a 4% to 6% drop in shares of companies like Lockheed Martin, indicating market concerns and uncertainty surrounding the defense sector.
- Military Budget Proposal: By proposing to increase the military budget from $1 trillion to $1.5 trillion for 2027, Trump aims to enhance U.S. military capabilities, which could stimulate investment and growth in related industries.
- Surge in High-Growth Drone Stocks: Following Trump's remarks, stocks of drone and autonomous systems companies like AeroVironment and Kratos soared by double digits, reflecting market optimism that these firms will benefit from increased defense spending.
- Executive Compensation Caps: Trump proposed a $5 million cap on executive pay for underperforming firms, demanding that capital be redirected into new production facilities, which may impact management structures and investment directions within the defense industry.
Analyst Views on AVAV
Wall Street analysts forecast AVAV stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for AVAV is 387.00 USD with a low forecast of 285.00 USD and a high forecast of 450.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
13 Analyst Rating
13 Buy
0 Hold
0 Sell
Strong Buy
Current: 302.670
Low
285.00
Averages
387.00
High
450.00
Current: 302.670
Low
285.00
Averages
387.00
High
450.00
About AVAV
AeroVironment, Inc. is a defense technology provider delivering integrated capabilities across air, land, sea, space, and cyber. The Company develops and deploys autonomous systems, precision strike systems, counter-UAS technologies, space-based platforms, directed energy systems, and cyber and electronic warfare capabilities. The Company’s segments include Autonomous Systems (AxS) and Space, Cyber, and Directed Energy (SCDE). The AxS segment focuses on the design, development, production, delivery, and support of intelligent, multi-domain robotic systems, including uncrewed aircraft systems (UAS) and ground robot systems. It includes the Company’s former Uncrewed Systems, Loitering Munitions Systems, and MacCready Works segments as well as Radio Frequency and Kinetic Counter-UAS Electronic Warfare Systems and others. The SCDE segment focuses on advanced technologies in the space domain providing space-based and ground-based platforms, cyber capabilities, and directed energy systems.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
