We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Ondas Stock Skyrockets Over 725% in a Year: Time to Lock in Profits?
Read MoreHide Full Article
Key Takeaways
ONDS has soared 725.5% in a year as revenues jump on strong OAS unit performance.
OAS growth is driven by Optimus, Iron Drone Raider deliveries and new defense wins.
Heavy reliance on OAS, rising costs and a rich valuation raise volatility concerns.
Ondas Holdings Inc. (ONDS - Free Report) has had a dramatic year, with the stock gaining a staggering 725.5%, dwarfing the Communication-Network software industry’s 8.1% decline. The Zacks Computer and Technology sector and the S&P 500 composite have risen 25.8% and 15.2%, respectively, in the same time frame.
Price Performance
Image Source: Zacks Investment Research
ONDS provides private wireless data solutions through its Ondas Networks division and autonomous drones via Ondas Autonomous Systems (“OAS”). The rally has been driven by the company’s strategic focus on its OAS unit, string of acquisitions, a strengthened balance sheet and aggressive expansion into global defense ecosystems.
In the last reported quarter, revenues surged more than sixfold year over year to $10.1 million, driven almost entirely by OAS, which contributed $10 million compared with just $1 million a year earlier.
ONDS’ gains are way more than some of the players in the drone space like Draganfly (DPRO - Free Report) , Unusual Machines (UMAC - Free Report) and AeroVironment (AVAV - Free Report) stocks. AVAV, DPRO and UMAC are up 59.4%, 88.1% and 18.9%, respectively, over the same time frame.
Given the dizzying gains, investors must now evaluate whether the rally is sustainable or if it is time to take profits after an overextended climb.
Let’s unpack.
Rally Driven Entirely by OAS
The most compelling part of the ONDS story remains OAS, which is transitioning into a high-visibility growth engine. OAS is gaining primarily from the deliveries for both its Optimus System and Iron Drone Radar counter-UAS platforms, as well as contributions from Apeiro ground robots.
ONDS noted that the customer pipeline remains strong and expects to end 2025 with further backlog expansion. It remains focused on the counter-UAS market. Ondas is expanding its footprint with new defense and homeland security customers across Europe and the United States. ONDS expects the Mistral partnership to boost U.S. government adoption of Optimus and Iron Drone platforms.
The company’s recent partnership and investment in Rift Dynamics represents a key step toward localization efforts and capability expansion across European defense markets. Rift’s Wasp platform (a modular, low-cost, mass producible drone platform) complements Ondas' Optimus and Iron Drone Raider, boosting OAS’ defense portfolio.
Ondas Holdings Inc. Price, Consensus and EPS Surprise
The focus on M&A is expected to strengthen portfolio offerings and broaden reach across multiple domains like unmanned ground systems, robotics and fiber optic communications, subsurface intelligence and demining robotics. In the past few months, it has acquired Sentrycs, Apeiro Motion, Zickel, among others and recently announced an agreement to buy Roboteam, which specializes in multi-mission tactical ground robotics.
A robust balance sheet is an add-on. As of Sept. 30, 2025, Ondas had $433.4 million in cash, cash equivalents and restricted cash, and has raised $855 million since June to support its aggressive expansion plans.
Challenges Now Emerge for ONDS
Heavy dependence on the OAS division for revenue growth in the increasingly crowded drone space is a concern. The drone industry is witnessing rapid growth, with the global drone tech market expected to witness a CAGR of 14.3% from 2025 to 2030, according to a report from Grand View Research. As a result, competition has heated up with drone companies like Unusual Machines, AeroVironment and Draganfly vying to grab a larger share.
For ONDS, if a single large customer delays, reduces or cancels, revenues would decline materially. For a stock that has already run more than 725%, even slight execution slips could result in significant volatility.
Further, so many acquisitions in such a short period of time can create integration overload risk. Although these buyouts provide undeniable technological depth, investors must watch closely for an increase in expenses and execution risks.
ONDS is in the middle of a massive transition and already incurring sizable expenses. Management described a period of heavy infrastructure building and team expansion. These moves strengthen long-term competitive moat, but amplify short-term financial pressure.
In the last reported quarter, operating expenses increased to $18.1 million, up from $8.7 million in the prior-year quarter, mainly driven by higher personnel costs. As a result, adjusted EBITDA loss widened to $8.8 million compared with a loss of $7.1 million in the year-ago quarter. Net loss was $7.5 million compared with $9.5 million in the third quarter of 2024. Net loss included higher interest and dividend income from the increased cash balance and $6.9 million unrealized gain on minority equity investments.
For its Ondas Networks, the company expects “meaningful adoption” by the railroads in 2026 for dot16, but at present has “modest revenue expectations from Ondas Networks relative to the OAS business”.
Image Source: Zacks Investment Research
For the current quarter, earnings estimates have remained unchanged, but have been revised 25% downwards for the next quarter. While current-year estimates have been revised upwards, next-year estimates are showing a downward revision.
Lofty Valuation Compounds Troubles
ONDS stock is trading at a substantial premium, with a forward 12-month price/sales of 22.79X compared with the industry’s 2.11X. The premium valuation exposes investors to sharp volatility and makes downside risk more marked in the near to medium term.
Image Source: Zacks Investment Research
ONDS: Offload for Now
At present, ONDS carries a Zacks Rank #4 (Sell).
While ONDS is building a strong long-term story, the current lofty valuation, execution pressures and ballooning expenses suggest investors may want to consider locking in profits and exiting.
Image: Bigstock
Ondas Stock Skyrockets Over 725% in a Year: Time to Lock in Profits?
Key Takeaways
Ondas Holdings Inc. (ONDS - Free Report) has had a dramatic year, with the stock gaining a staggering 725.5%, dwarfing the Communication-Network software industry’s 8.1% decline. The Zacks Computer and Technology sector and the S&P 500 composite have risen 25.8% and 15.2%, respectively, in the same time frame.
Price Performance
Image Source: Zacks Investment Research
ONDS provides private wireless data solutions through its Ondas Networks division and autonomous drones via Ondas Autonomous Systems (“OAS”). The rally has been driven by the company’s strategic focus on its OAS unit, string of acquisitions, a strengthened balance sheet and aggressive expansion into global defense ecosystems.
In the last reported quarter, revenues surged more than sixfold year over year to $10.1 million, driven almost entirely by OAS, which contributed $10 million compared with just $1 million a year earlier.
ONDS’ gains are way more than some of the players in the drone space like Draganfly (DPRO - Free Report) , Unusual Machines (UMAC - Free Report) and AeroVironment (AVAV - Free Report) stocks. AVAV, DPRO and UMAC are up 59.4%, 88.1% and 18.9%, respectively, over the same time frame.
Given the dizzying gains, investors must now evaluate whether the rally is sustainable or if it is time to take profits after an overextended climb.
Let’s unpack.
Rally Driven Entirely by OAS
The most compelling part of the ONDS story remains OAS, which is transitioning into a high-visibility growth engine. OAS is gaining primarily from the deliveries for both its Optimus System and Iron Drone Radar counter-UAS platforms, as well as contributions from Apeiro ground robots.
ONDS noted that the customer pipeline remains strong and expects to end 2025 with further backlog expansion. It remains focused on the counter-UAS market. Ondas is expanding its footprint with new defense and homeland security customers across Europe and the United States. ONDS expects the Mistral partnership to boost U.S. government adoption of Optimus and Iron Drone platforms.
The company’s recent partnership and investment in Rift Dynamics represents a key step toward localization efforts and capability expansion across European defense markets. Rift’s Wasp platform (a modular, low-cost, mass producible drone platform) complements Ondas' Optimus and Iron Drone Raider, boosting OAS’ defense portfolio.
Ondas Holdings Inc. Price, Consensus and EPS Surprise
Ondas Holdings Inc. price-consensus-eps-surprise-chart | Ondas Holdings Inc. Quote
The focus on M&A is expected to strengthen portfolio offerings and broaden reach across multiple domains like unmanned ground systems, robotics and fiber optic communications, subsurface intelligence and demining robotics. In the past few months, it has acquired Sentrycs, Apeiro Motion, Zickel, among others and recently announced an agreement to buy Roboteam, which specializes in multi-mission tactical ground robotics.
A robust balance sheet is an add-on. As of Sept. 30, 2025, Ondas had $433.4 million in cash, cash equivalents and restricted cash, and has raised $855 million since June to support its aggressive expansion plans.
Challenges Now Emerge for ONDS
Heavy dependence on the OAS division for revenue growth in the increasingly crowded drone space is a concern. The drone industry is witnessing rapid growth, with the global drone tech market expected to witness a CAGR of 14.3% from 2025 to 2030, according to a report from Grand View Research. As a result, competition has heated up with drone companies like Unusual Machines, AeroVironment and Draganfly vying to grab a larger share.
For ONDS, if a single large customer delays, reduces or cancels, revenues would decline materially. For a stock that has already run more than 725%, even slight execution slips could result in significant volatility.
Further, so many acquisitions in such a short period of time can create integration overload risk. Although these buyouts provide undeniable technological depth, investors must watch closely for an increase in expenses and execution risks.
ONDS is in the middle of a massive transition and already incurring sizable expenses. Management described a period of heavy infrastructure building and team expansion. These moves strengthen long-term competitive moat, but amplify short-term financial pressure.
In the last reported quarter, operating expenses increased to $18.1 million, up from $8.7 million in the prior-year quarter, mainly driven by higher personnel costs. As a result, adjusted EBITDA loss widened to $8.8 million compared with a loss of $7.1 million in the year-ago quarter. Net loss was $7.5 million compared with $9.5 million in the third quarter of 2024. Net loss included higher interest and dividend income from the increased cash balance and $6.9 million unrealized gain on minority equity investments.
For its Ondas Networks, the company expects “meaningful adoption” by the railroads in 2026 for dot16, but at present has “modest revenue expectations from Ondas Networks relative to the OAS business”.
Image Source: Zacks Investment Research
For the current quarter, earnings estimates have remained unchanged, but have been revised 25% downwards for the next quarter. While current-year estimates have been revised upwards, next-year estimates are showing a downward revision.
Lofty Valuation Compounds Troubles
ONDS stock is trading at a substantial premium, with a forward 12-month price/sales of 22.79X compared with the industry’s 2.11X. The premium valuation exposes investors to sharp volatility and makes downside risk more marked in the near to medium term.
Image Source: Zacks Investment Research
ONDS: Offload for Now
At present, ONDS carries a Zacks Rank #4 (Sell).
While ONDS is building a strong long-term story, the current lofty valuation, execution pressures and ballooning expenses suggest investors may want to consider locking in profits and exiting.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.