Why Unusual Machines Stock Just Popped
Unusual Machines (UMAC +23.79%) stock took off like a rocket this morning after President Trump announced new tariffs on imported drones and drone parts.
As of 11:55 a.m. ET Friday, Unusual Machines stock is up 26%.
Image source: Getty Images.
President Trump’s drone tariffs
The Wall Street Journal explains that the new tariffs are intended to boost drone production and create jobs in the drone industry in the U.S. — while also enhancing national security by developing a home-grown drones industrial base.
China currently dominates international drone production, but isn’t always friendly to the U.S. The President doesn’t want the U.S. depending on China should the countries come into conflict. Accordingly, the Journal notes that imports of drones and drone parts from China “will face significantly higher levies than those from allied nations.” Friendly nations such as Japan, Liechtenstein, South Korea, Switzerland, and Taiwan, as well as EU countries, will be tariffed at only 15%. The U.K. will receive a 10% tariff rate on drones.
Final tariffs may be higher or lower than these numbers, depending on the technology involved; drones with thermal imaging equipment, in particular, will be subject to 100% tariffs. The tariffs will start going into effect three weeks from now and will be fully implemented in six months.
Today’s Change
(23.79%) $6.48
Current Price
$33.72
Key Data Points
Market Cap
Day’s Range
$29.35 – $34.93
52wk Range
$7.25 – $34.93
Volume
11.2M
Avg Vol
6M
Gross Margin
34.01%
What it means for Unusual Machines
As the Trump tariffs go into effect, sales of Unusual Machines’ Fat Shark-brand video goggles for drone pilots, and made-in-the-USA drone motors, flight and speed controllers, videocameras, video transmitters, and other drone parts should boom.
U.S. drone companies seeking drone parts not made in China will likely turn to Unusual Machines as the highest-profile all-American supplier around. Even analysts who were forecasting sales to quintuple this year — and double again next year — may find themselves pleasantly surprised.
Shareholders should be pretty pleased, too.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
