** Drone-related stocks rise premarket after U.S. Defense Secretary Pete Hegseth reportedly ordered sweeping new orders to fast-track drone production and deployment
** Shares of AeroVironment AVAV.O and Kratos Defense & Security Solutions KTOS.O both up ~4% before the bell, and Red Cat Holdings' RCAT.O stock rallying ~18%
** As part of an aggressive push to outpace Russia and China in unmanned warfare, "the Department’s bureaucratic gloves are coming off," Hegseth wrote in a memo, according to report by Fox News
** For the first time, commanders with the rank of colonel or captain can independently procure and test drones, including 3D-printed prototypes and commercial-off-the-shelf systems, as long as they meet national security criteria, per the report
** The Pentagon's FY26 budget ramped up investment in unmanned aerial systems (UAS) and counter-drone technology — a 78% increase that's reshaping the entire military landscape
** Through Thurs close, AVAV and KTOS up 54% and 75%, respectively, YTD. Conversely, RCAT has nearly halved in 2025
** Broader NYSE Arca Defense Index .DFII has gained 23% YTD through Thurs
(Lance Tupper is a Reuters market analyst. The views expressed are his own)
((lance.tupper@tr.com 1-646-279-6380))
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.