The Pentagon’s Gauntlet II results are posted, and the scoreboard belongs almost entirely to private companies.
- RCAT stock is moving lower. See the real-time price action here.
Ten finalists were picked across two mission areas after August testing at Fort Carson, Colorado, where drones flew find-fix-finish missions at 15-kilometer stand-off ranges and inside confined spaces, some of it repeated at night and against counter-drone systems.
Perennial Autonomy topped the Deep Strike competition with 80.1 points, ahead of Hyperscale at 70.9, Neros at 69.8, Skycutter at 66.6 and Swarm Defense Technologies at 66.0.
Neros won the Close Quarters Battle with 88.1, followed by ORQA US, XTEND Reality, Vector and ModalAI. Order quantities stay blank until contract award, and the program warns awards are not guaranteed.
None of the ten leaders trade publicly, but traders can use read-throughs instead of pure plays.
The Losers are the Tradable Names
Teal Drones Inc., the subsidiary of Red Cat Holdings, Inc. (NASDAQ:RCAT), competed in Close Quarters Battle and did not place in the top five.
Ascent Aerosystems Inc., owned by Ondas Holdings Inc. (NASDAQ:ONDS), missed in Deep Strike. Both companies remain eligible for future Gauntlets, per the program’s regulations.
Red Cat shares changed hands at $6.88, down 3.10% Friday morning and 24.4% since Aug. 25, just before Gauntlet II testing wrapped. The stock sits 63.4% below its 52-week high, with a market value of $1.05 billion.
Ondas traded at $7.30, off 1.26% on the day and 11.4% over the same stretch, valuing the company at $4.16 billion.
Red Cat’s Gauntlet I record was already thin: the company was absent from the top 11 that collected delivery orders. Ondas’ Ascent Aerosystems placed 10th in that round with 1,600 units ordered, of which 800 have been accepted.
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Where the Upside Hides
Component suppliers offer the cleanest exposure to winners nobody can buy. Unusual Machines, Inc. (AMEX:UMAC) makes drone parts and counts Donald Trump Jr. as an advisor.
The Trump administration has held talks about funding both Unusual Machines and Sequoia Capital-backed Neros, with proposals involving a mix of debt and equity that could hand the government ownership stakes. Shares of UMAC traded at $23.11 on Friday, down 3.25%.
Larger defense names moved with the sector during May’s funding headlines, including Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) and AeroVironment, Inc. (NASDAQ:AVAV), which rose alongside peers in the Spring, should also be monitored this round.
Photo: Pavlow / Shutterstock
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