President Donald Trump’s pledge to increase the country’s military budget from $900 billion to $1.5 trillion has sent defense stocks soaring, including robotics and drone solutions provider, Red Cat Holdings, Inc. (NASDAQ:RCAT), over the past week.
Shares of Red Cat Holdings are up 41.70% year-to-date, in just over a week of trading in the new year, a surge that is sending its Momentum score in Benzinga’s Edge Stock Rankings soaring.
Defense Stock’s Momentum Soars
The Momentum score in Benzinga’s Edge Stock Rankings is assessed based on the relative strength of a stock, while taking into account its price movements and volatility across multiple time frames, before ranking them individually as a percentile against all other stocks.
Red Cat’s Momentum score has surged from 13.59 to 74.77 within the span of a week, owing to the stellar rally in the stock, which began with the Federal Communications Commission’s decision to ban Chinese drone-makers DJI and Autel.
This created strong momentum among domestic U.S. drone stocks, such as Red Cat, Ondas Holdings, Inc. (NASDAQ:ONDS) and AeroVironment, Inc. (NASDAQ:AVAV), among others.
Another major catalyst was Trump’s decision to significantly increase the defense budget over the past week, which came around the same time as the raid on Venezuela, which led to the capture of the country’s President Nicolás Maduro, with similar tensions now beginning to flare in Iran.
All of these factors created strong tailwinds for defense stocks, and Red Cat was among the key beneficiaries. The stock scores high on Momentum in Benzinga’s Edge Stock Rankings, with a favorable price trend in the short, medium and long terms. Click here to see how it compares with Ondas and other key competitors.
Photo Courtesy: Evan El-Amin on Shutterstock.com
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