Well, someone just won the defense contractor lottery, and it wasn't Lockheed Martin or Raytheon.

If you’ve been following along, this isn’t the first time Red Cat Holdings has peaked our interest…but this time, they’ve pulled off a move that’s turning heads across the defense industry. The small drone maker just landed a game-changing contract to become the exclusive provider for the U.S. Army’s Short Range Reconnaissance program. It’s a win no one saw coming… except maybe Wall Street. Since the announcement, Red Cat’s stock has jumped 28% and is now up a staggering 125% over the past month.

I guess you could say the Army, with its $178 billion budget, looked at all the defense giants and said, "Nah, we're going with the scrappy underdog instead. Last year, Red Cat reported a pretty boring $4.9 million in revenue. Now they're staring down a potential $260 MILLION payday as the Army plans to buy 11,700 of their drones. 

The drone that sealed this deal is called the Black Widow. (Points for not calling it something lame like "Eagle Eye" or "Freedom Flyer.") This thing is basically what happens when you combine military-grade surveillance tech with the ability to operate in places where GPS doesn't work. If you've ever lost your phone signal in a parking garage, imagine flying a regular drone there… it ain't happening. The Black Widow doesn't have that problem.

As a side note, Red Cat partnered with Palantir… yes, the same data company that makes governments and privacy advocates equally nervous… to jam their drones full of AI. They also scooped up FlightWave Aerospace, adding the Edge 130 tri-copter to their lineup (it’s basically the Black Widow on steroids). 

Did I mention Donald Trump Jr. is on Red Cat's board? Because he is. Now, I'm not saying this is why they won the contract. But in the defense world, having political connections is about as surprising as finding out water is wet. 

Red Cat is now projecting between $80 and $120 million in revenue for 2025. Northland analyst Michael Latimore just issued a $13 price target on the stock… more than double its current price around $6. That’s a projected upside of over 115%, signaling serious confidence in where this company could be headed (meaning maybe it’s time to start paying attention).

If they actually deliver on these contracts without any huge problems (always a risk with small companies suddenly drinking from a firehose of cash), this could be one of those stocks people talk about years from now. 

Stocks.News has positions in Lockheed Martin, Palantir, and Red Cat mentioned in article.