Redwire Corp. shares climbed sharply in premarket trading Tuesday, extending a rally that began before the Memorial Day holiday, as investors reacted to new drone contracts from the U.S. Army and a NATO ally. The stock reached $20.55 as of 5:01 a.m. EDT, representing a 17.5% gain from Friday's close of $17.49, which itself had risen 13.9%.
The surge follows the company's announcement of a $15 million follow-on order from the 1st Aviation Brigade at the U.S. Army Aviation Center of Excellence for its Stalker unmanned aerial systems. This marks the third such order in eight months, bringing total recent Army orders to $24.8 million. Steve Adlich, head of Redwire Defense Tech, noted the Stalker drone is designed for versatile missions, aiding the Army in threat detection, identification, and tracking. The systems will support advanced individual training at Fort Huachuca, a key facility for tactical UAS specialists.
Just a day earlier, Redwire disclosed a multi-year contract valued in the high eight figures from an undisclosed NATO country for its Penguin Mk3 tactical UAS. Adlich described the deal as a forward-looking initiative for NATO allies modernizing their tactical drone capabilities.
These awards are reshaping market perception of Redwire, traditionally viewed as a space infrastructure play akin to Rocket Lab. The new contracts push the company closer to defense drone peers like AeroVironment and Kratos Defense & Security Solutions. Redwire's background in satellites and spacecraft still aligns it with Rocket Lab, but the fresh orders highlight a growing defense angle.
The contract news follows Redwire's first-quarter earnings report, which showed revenue of $97.0 million, up 57.9% year-over-year, with a gross margin of 26.6%. The company's backlog stood at $498.1 million, and its book-to-bill ratio was 1.92. CEO Peter Cannito cited strong demand, while CFO Chris Edmunds highlighted record total liquidity of $175.2 million and maintained the 2026 revenue outlook of $450 million to $500 million.
Despite the positive momentum, bearish factors persist. Redwire posted a Q1 net loss of $76.5 million and adjusted EBITDA of negative $9.2 million. Analyst consensus from S&P Global shows a 'Buy' rating among 10 analysts, but the average price target of $14.44 remains below both Friday's close and Tuesday's premarket price. KeyBanc rated the stock a Hold on May 20, while Truist, Canaccord, Jefferies, and Alliance Global Partners issued Buy ratings earlier this month.
Investors face uncertainties, including the lack of details on the NATO contract's funding, delivery timelines, or potential follow-on work. Government drone deals are notoriously unpredictable and subject to budget shifts. Tuesday's market open will test whether last week's drone news signals a genuine defense-growth trajectory or merely a temporary swing in the volatile small-cap space sector.
