Ahead Of The Bell: AeroVironment Downgraded

HARTFORD, Conn. (AP) — A surprising first-quarter loss reported by AeroVironment Inc. prompted an analyst Wednesday to downgrade shares of the maker of unmanned aircraft on lower profit estimates.

Shares fell in premarket trading.

Janney Montgomery Scott analyst John M.A. Roy downgraded the Monrovia, Calif., company to "Neutral" from "Buy."

AeroVironment Inc. said Tuesday that revenue was hurt by the deferral of Raven unmanned aircraft systems deliveries because customers are waiting for new digital Raven systems and upgrade kits for existing aircraft, which are expected in the second half of the year.

Roy said he, too, is waiting for AeroVironment's digital data link, a digital, wireless video link.

"While we are believers in the long-term story for this stock, we see very limited upside at this point and are stepping aside to see what happens with the company's rollout of its DDL product," he said in a note to investors.

He reduced his fiscal 2010 estimate to $1.13 per share from $1.28 per share, including a higher estimate for the second half of the year to account for a backlog in digital data link shipments and retrofits. Roy cut his fiscal 2011 estimate to $1.63 per share from $1.80 per share.