IREN vs. AeroVironment: Triple-Digit Revenue Growth, Two Completely Different Stories

Both IREN and AeroVironment posted revenue growth above 100% in their latest periods. That number alone is enough to get a stock featured in a "hot growth" roundup. But revenue growth is the easiest metric to compare and usually the least useful one - because two companies can grow at the same rate and mean entirely different things for the portfolio.

Here's how the factor stack reads on each.

IREN (NASDAQ: IREN) - The AI Infrastructure Growth Bet

Valuation: C− - The stock trades at 20.3 times EV/sales, 18.4 times trailing sales, and a forward P/E of 160x. For comparison, Vertiv Holdings - the most direct AI infrastructure peer - trades at 9.3x sales and 41.8x EV/EBITDA. IREN commands roughly double the revenue multiple of Vertiv, which means the market is pricing in that the company's growth accelerates and sustains at a very high level for years. The PEG ratio sits at 0.42x, which looks cheap by that single metric, but PEG ratios are backward-looking and don't capture the capital intensity or dilution risk IREN carries.

Growth: A - Revenue growth of 104.8% year-over-year, with the company expanding from roughly 3 megawatts of self-built AI cloud capacity a year ago to 480 megawatts in 2026 and 1.2 gigawatts targeted for 2027. In July, IREN announced $2.8 billion in new multi-year AI cloud contracts, lifting its 2026 annualized run-rate revenue target from $3.7 billion to over $4 billion, with roughly 85% of that now under contract. The customer base includes Microsoft, NVIDIA, Perplexity, Figure AI, Together AI, and others. About 45% of GPU capex under recent contracts is covered by customer prepayments - a funding model that's becoming more common as AI developers lock in scarce compute capacity ahead of deployment. Growth grade is an A because the revenue trajectory is real, contracted, and accelerating.

Profitability: D− - Gross margin is 68.4%, which is excellent for an infrastructure operator. But operating margin is negative 53.95%, and EBITDA margin is just 10.35%. Free cash flow for the trailing twelve months is negative $2.43 billion, with capex of $2.82 billion. ROIC is negative 10.1%. The gross margin tells you the business model works on paper; the operating margin tells you the company is spending more to build the machines than it earns running them, and that gap is structural during the build-out phase.

Safety: C - Cash and equivalents sit at $2.21 billion, with approximately $7.6 billion reported as of June 30 per the company's July filing. Total debt is $4.6 billion, giving a debt-to-equity ratio of 138% and net debt of $1.48 billion. The current and quick ratios both sit at 372%, so short-term liquidity isn't a problem. But the capital burn rate - $2.82 billion in capex over the trailing twelve months - means that cash position works backward. Customer prepayments covering 45% of GPU capex helps, but the trajectory still requires either more equity financing, more debt, or both.

Momentum: C - The stock is at $38.89, down 4.8% today but up 32.7% over the past five days on the $2.8 billion contract news. The 200-day moving average is $47.69, the 50-day is $48.14, and RSI is 47.3 - the stock is below both moving averages despite the recent spike. Year-to-date the stock is up just 3.0%, though the rolling 12-month return is 103.9%. The 52-week range spans $17.22 to $76.87. Momentum is flat because the stock has been choppy and volatile, unable to sustain a trend above its moving averages.

Portfolio role: IREN belongs in the AI growth sleeve - specifically the infrastructure layer, not the chip or software layer. It hedges against the view that AI compute demand will outlast the current capex cycle and that vertically integrated operators with secured power and land positions will capture value that chip makers and cloud platforms can't. The trigger to reduce is factor deterioration in profitability - if operating margins don't start compressing toward zero as capacity comes online, the 20x revenue multiple becomes indefensible. The trigger to add is a dip below the 200-day MA combined with a maintained ARR trajectory.

AInvest's aggregate signal labels IREN a Buy with a 4.62 composite score. That cross-check aligns with the growth and momentum factors but underweights the valuation stretch and capital intensity risk.

AeroVironment (NASDAQ: AVAV) - The Defense Backlog Play

Valuation: A - The stock trades at 4.3 times EV/sales and 4.3x trailing sales. The trailing P/E is negative because the company posted a GAAP loss, and the forward P/E of 195x reflects the market's uncertainty about when sustained profitability arrives. But on a revenue basis, AVAV is cheap. Kratos Defense - the closest small-cap defense peer - trades at 6.8x sales and 94x EV/EBITDA. AeroVironment's 4.3x revenue multiple is less than two-thirds of Kratos, even though AVAV grew revenue faster. The valuation grade is an A because the revenue multiple is below the peer set despite triple-digit growth.

Growth: A - Revenue growth of 140.9% year-over-year, with fiscal 2026 full-year revenue reaching $1.98 billion, up 141% from fiscal 2025. Q4 alone posted a record $641.6 million, up 133% year-over-year. The company now targets $3.5 billion to $4 billion in revenue by fiscal 2030, which implies a 15% to 20% compound annual growth rate from the current base - a dramatic slowdown from today's pace, but one management has explicitly flagged as the realistic trajectory after a year of acquisition-driven spike. BlueHalo closed May 2025 and Empirical Systems Aerospace closed March 2026, and combined acquisitions contributed $282.3 million to the Q4 quarter alone. Growth is an A because the top-line is real, the backlog supports it, and the company has named the inflection point rather than pretending triple-digit growth is permanent.

Profitability: D - Gross margin for the trailing twelve months is 25.3%, down from 36% in the fourth quarter of fiscal 2025, dragged by the BlueHalo acquisition's service-heavy mix and $18.4 million in quarterly intangible amortization. Operating margin is negative 15.7%, EBITDA margin is negative 2.3%. A $151.3 million goodwill impairment in Q3 (triggered by a Space Force stop-work order) weighs on GAAP profitability but is a non-cash, one-time adjustment. ROIC is negative 9.5%. Management has guided adjusted EBITDA margins to 18%–20% by fiscal 2030, which would represent a massive improvement from today's position. Profitability is a D because the company is currently losing money on operations, but the trajectory is explicitly upward if the guidance holds.

Safety: B+ - Cash is $377.3 million, total debt is $1.32 billion, net debt is just $96.7 million. The current ratio is 430% and the quick ratio is 359%, both very strong for a defense contractor. Debt-to-equity is 16.6%, far below IREN's 138%. Free cash flow is negative $165 million over the trailing twelve months, but capex of $86 million is modest compared to IREN's $2.82 billion. The funded backlog sits at $1.2 billion with a book-to-bill ratio of 1.4 - meaning the company booked more than it billed over the fiscal year. Safety is a B+ because the balance sheet is conservative, the backlog provides revenue visibility, and the company isn't burning capital at infrastructure scale.

Momentum: C+ - The stock is at $168.06, below its 200-day moving average of $232.59 and just above the 50-day of $164.54. The stock is down 30.5% year-to-date and 33.1% over the rolling year, having fallen from a 52-week high of $417.86 to a low of $135.20. RSI is 57.1, in neutral territory. The recent 18.3% gain over five days suggests a bounce attempt, but the stock remains well below its 200-day MA. Momentum is a C+ because price action has been brutal despite record revenues - the market is discounting the acquisition-driven nature of the growth, the goodwill impairment, and the question of whether profitability can actually arrive as guided.

Portfolio role: AVAV belongs in the defense growth sleeve. It hedges against rising geopolitical tension and sustained government demand for autonomous systems and counter-UAS platforms. The backlog-driven revenue model means earnings are less cyclical than typical growth names. The trigger to reduce is a break in the pipeline - if book-to-bill falls below 1.0 or the company misses its fiscal 2030 margin guidance in consecutive quarters. The trigger to add is a move above the 200-day MA combined with margin confirmation.

AInvest's aggregate signal labels AVAV a Buy with a 1.88 composite score - notably more bullish than IREN's 4.62, reflecting the valuation discount and backlog visibility.

The Comparison

These two stocks share a revenue growth percentage. Almost nothing else.

IREN is an infrastructure build-out story. It trades at 20x revenue because the market believes the AI compute shortage is structural and IREN's vertically integrated model - secured power, land, and data centers - will capture outsized value. The risk is execution: the company burned $2.43 billion in free cash flow over the past year and needs customer prepayments and equity to bridge the gap until GPU deployments start generating positive returns on capital. If capacity ramps as planned, margins improve, and dilution is controlled, the growth justifies the multiple. If it doesn't, the stock could re-rate sharply lower. The 103.9% rolling return reflects how much conviction the market already has.

AeroVironment is a defense backlog story. It trades at 4.3x revenue because the market doesn't know what to do with a company that grew revenue 141% but lost money on operations, took a $151 million impairment, and acquired two other businesses in a single year. The risk here is integration and profitability execution: can AVAV actually deliver on the 18%–20% adjusted EBITDA margin guidance by fiscal 2030? The $1.2 billion funded backlog and 1.4 book-to-bill ratio say yes. The price action over the past year says the market isn't convinced yet.

If you want growth with a margin of safety, AVAV's revenue multiple gives you room for error. If you want exposure to the AI infrastructure build-out and can tolerate a multiple that assumes everything goes right, IREN is the play. Both require patience - IREN needs capacity to come online and margins to converge, AVAV needs integration to work and profitability to materialize. Neither has proven the operating thesis yet, which is why the revenue growth number alone doesn't tell you which one to buy.

Volatility is usually a signal that the market can't figure out what comes next. The response isn't more conviction - it's understanding what the factor stack is actually pricing in, and which one matches the risk you're willing to carry.