Hot Off the IPO Press: 3 New 'Strong Buy' Stocks in Drones, Defense & Data Centers

It was a hot first quarter for IPOs. So, today we're taking a look at three newly public stocks that Wall Street already rates a strong buy. So, let's get into it. All right, guys. Welcome back. Thank you all so much for being here. It is Julie with TipRanks. Now, Q1 of 2026 was one of the strongest quarters for traditional IPOs in the past 5 years. And today, we're taking a look at three companies that have now picked up a bunch of buy ratings from Wall Street analysts. A drone maker, a defense parts powerhouse, and an air solution companies with ties to the AI boom. We're going to take a look at these companies, what it is that they do, and what has Wall Street analysts already feeling so bullish. I came across these companies on the TipRanks IPO calendar, where you can find priced, upcoming, and filed IPOs. You can follow along over on the TipRanks website or right on the TipRanks mobile app. Links are in the description down below. And if you enjoy today's video, make sure you hit that thumbs up button and that you're subscribed to the channel. Now, let's jump right into these three strong buy new IPO stocks. First on the list, we're taking a look at Avex Corporation. They trade under the ticker AVEE X, and they hit the markets on April 16th after raising $320 million at $20 per share, valuing the company at about $2.2 billion. Shares surged after their IPO, hitting nearly $36, and it's now sitting at $27.53. Avex is a pure-play military drone company based out of California. They build two core products, unmanned aircraft systems and unmanned surface vehicles, especially drones in the air and at sea. Their systems are purpose-built for the military, reconnaissance, deep strike missions, and autonomous operations in GPS-denied environments. Their two flagship programs have delivered or committed to over 9,300 systems, representing more than 1.2 billion dollars in contract value through the end of 2026. And they're also developing their own mission software platform called Compass X, giving them a recurring revenue angle beyond just hardware. With the Department of Defense requesting over 50 billion dollars for unmanned systems in their 2027 budget, and the global drone market expected to hit 26 billion by 2030, AVX is sitting right in the middle of one of defenses fastest growing categories. And looking on the fly.com for the latest stock news, just last week AVX announced it's been awarded an 18.5 million dollar contract from the US Air Force, but the delivery of their autonomous aircraft for one-way attack. It also includes support by AVX engineering and their field services team. AVX has not yet shared a quarterly report since going public, but it is coming up very soon. This week after the close on May 20th. But we have still heard from quite a few analysts on the stock. An analyst at Bank of America said the pure play producer of military attributable unmanned systems or drones aligns with modern war priorities. And they forecast for a roughly 20% revenue compound annual growth rate over the next five years, and adjusted EBITDA growth of about 30% by 2030. Another analyst at William Blair said that the firm expects a threefold increase in next-gen drone spending to approximately 10 billion over the next five years. This newly public stock has caught the eye of nine current analysts, who all rate it a buy. And the average price target of $35.25 implies an upside potential of 27%. Looking at the analysts down below, those price targets range from an upside of 11.9% all the way up to 62%. Second on the list today is Arcis Incorporated. It trades under the ticker ARX S. They hit the public market on April 15th. They raised $1.13 billion and were priced at the very top of their $25 to $28 range, but surged nearly 36% on their debut, going up to nearly $39 per share. It'll settle down a bit since, now sitting at $33.83. Arcis is a designer and manufacturer of proprietary mission-critical components for the aerospace, defense, and space industries. We're talking about the highly specialized electronic and mechanical parts that keep military aircraft flying, satellites operating, and defense systems functioning under extreme conditions. What makes Arcis different from a typical defense contractor is that they don't build the big platforms, they build the critical components inside them. That means they're supplier to multiple programs and multiple primes, which gives them incredible diversification. They have also not yet shared an earning support since going public, but that is coming up soon, next week on May 27th. What we do know is in the recent years leading up to their IPO, the company doubled their annual revenue. And of course, we are starting to hear from Wall Street. Recently initiating coverage was a five-star analyst at Wells Fargo. They said that Arcis is an industrial compounder, which has more than doubled its EBITDA over the last four years through organic growth and acquisitions. They say the company manufactures highly engineered mechanical and electronic components that are mission-critical, but represent less than 1% of the total platform costs. They see low double-digit EBITDA growth going forward for Arcis. Also weighing in was a five-star analyst at Wolfe Research who sees solid growth tailwinds across the company's core end markets and a proven acquisition track record and sees potential upside to the company's five-year growth targets. The Arcsys stock has 10 current analyst ratings nearly coming in as a unanimous strong buy with nine buys and one hold. The average price target of $44.44 represents an upside potential of 31%. And looking at those price targets down below, they range from an upside of 15% up to 62%. If you've made it all the way to our third stock today, then do me a favor and make sure you've hit that thumbs up button. Last but not least, we're looking at Madison Air Solutions. They trade under the ticker MAIR. They hit the public markets on April 15th raising $2.23 billion, the biggest of our three today. They were priced at the top of their range at $27 per share and opened 18 and 1/2% its IPO price at $31.75 since climbing to $38.10. Madison Air Solutions is a leader in premium air quality and ventilation systems and is one of the most interesting AI-adjacent infrastructure plays to come to market this year. They serve four key end markets: healthcare, data centers, manufacturing, and logistics. Their products manage airflow and ventilation inside some of the most demanding out there from hospital operating rooms, pharmaceutical clean rooms, and increasingly AI data centers that generate enormous heat and need sophisticated air management to operate. As hyperscalers pour billions into next-gen data center build-outs, the demand for companies like Madison Air that handle the thermal and air management inside those facilities is accelerating fast. Madison Air has shared their first quarterly report since going public last week on May 12th, and the results were strong. Earnings per share of 18 cents beat expectations by 3 cents per share, while Q1 adjusted EBITDA of 233 million was up from 168 million last year. They saw record net sales increase 12.5% year-over-year, and their backlog was up an eye-popping 115%. The company also forecast 2026 revenue of 3.75 to 3.85 billion, which was ahead of the consensus. Prior to that earnings report, we already had plenty of Wall Street analysts initiating coverage on the stock with a buy. And following the report, we've already seen several increase their price targets. Pre-Q1 earnings report, an analyst at Citi said they believe the company's air management platform is well positioned to win share in a $40 billion total addressable market. Following that earnings report, we did hear from an analyst at Bank of America who increased their price target, calling the company's first quarter out of the gate following its IPO a strong one with guidance being above the firm's prior revenue and adjusted EBITDA estimates. With 13 current analyst ratings, Madison Air comes in as a strong buy with 10 buys and three holds. Recording in progress. The average price target is $47.64, implying an upside potential of 24%. Looking at the price targets down below, on the low end, we still have an upside of over 17% with a couple of the holds here and a couple of high-end price targets upwards of 30%. So, that is a quick look at three newly IPO'd stocks already rated a strong buy from Wall Street. Let me know in the comments down below if they were on your radar before or not, and which one you'd put on your watch list. I always love hearing from you guys. And keep in mind these videos are never a suggestion to buy or sell any specific stock, so always make sure you do your own research and due diligence. Thank you guys so much for watching. Have a fantastic day, and I'll see you back here next time.