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Piper Sandler starts Unusual Machines with Overweight, $38 target
The initiation cites a $2.1 million defense purchase order and an industry shift toward domestically assembled drones, while flagging execution risk as Unusual Machines scales output in Orlando.
Piper Sandler initiated coverage of drone maker Unusual Machines (UMAC) with an Overweight rating and a $38 price target, implying 39.5% upside from current levels, according to Yahoo Finance. The bullish view comes as the U.S. Federal Communications Commission is banning the use of Chinese-made drones and components, with a potential crackdown that could include drones that use LiDAR obstacle-avoidance features. At the same time, the U.S. government is increasing focus on domestic manufacturing of drones. Within that backdrop, Unusual Machines reportedly received a $2.1 million purchase order for domestically assembled drone systems for defense use this year. Piper Sandler also argued that UMAC is positioned to benefit commercially because it can supply motors, batteries, flight controllers, and other components that drone manufacturers need. However, the analysts warned about execution risk tied to Unusual Machines' rapid expansion plan, including scaling motor capacity from about 15,000 units per month to more than 100,000 via an automated production line in Orlando, the outlet said.