3 Startups Leading American Innovation… and 8 More in the Wings VIEW IN BROWSER In the early days of Russia’s war in Ukraine, volunteers and charitable foundations began assembling small-scale drones to help Ukraine’s war effort. These do-it-yourself makers outfitted commercial racing drones with better cameras (and eventually explosive payloads) to track and pressure invading forces. These cheap machines were startlingly effective. Drones could be piloted from hundreds of yards away to spot Russian tank positions and relay the coordinates to artillery teams. Other versions carried warheads, turning $350 drones into flying bombs. In fact, drones proved so useful that the Ukrainian government soon developed Decree 256, which established the country’s “Army of Drones” project. Today, drones have become the main anti-tank weapon in the Russian-Ukrainian war. More than half of the destruction on Ukraine’s front lines is credited to these unmanned machines, and its military uses them by the millions. The same concepts are now being used by U.S. forces. On January 3, Venezuelan residents reported hearing high-pitched buzzing noises right before major explosions at port facilities and military bases. Though the U.S. military has denied their use, social media videos suggest that the U.S. military used dozens (if not hundreds) of one-way “kamikaze” drones to attack Venezuelan targets while keeping American soldiers out of harm’s way. The assault created a diversion that allowed an American strike team to swoop in and capture Venezuela’s president and his wife. 
The success of Operation Absolute Resolve put defense stocks into overdrive. Shares of the defense “primes” rose double digits following America’s intervention in Venezuela, while some smaller firms rose even more. Whether or not you agree with American military intervention, it’s undeniable that these firms will benefit from increased military spending. We believe this is only the start. After all, defense primes were built to accept billion-dollar contracts for expensive fighter jets... not hundred-million-dollar orders for $350 drones. Instead, an entirely new generation of companies will emerge to fill this gap. That's why, over the past several weeks, Luke Lango and his team have combed through executive orders, pored over government memos, and spoken with military insiders to identify which companies are best positioned to receive U.S. government funding. Their conclusion: It’s an endeavor on the scale of the Manhattan Project or Apollo Program. Luke is calling it the “Genesis Mission.” This multiyear effort will see significant investments by the U.S. government in drone technologies and other critical areas. He identifies six core sectors that stand to gain: - Artificial Intelligence
- Quantum Computing
- Nuclear Energy
- Biotech
- Semiconductors
- Advanced Manufacturing
He will go into more detail on Tuesday, January 27, where he will reveal more about the eight stocks in his Genesis Portfolio that focus on these sectors. (He’ll also tell us some about several privately held companies benefiting from the federal government’s new focus as well.) Watch your inbox on Tuesday for a direct link to Luke’s free broadcast. To illustrate the types of companies he’s eyeing, I’d like to revisit three of my picks from previous InvestorPlace Digest updates that illustrate why investing in smaller innovative firms is so important for long-term success. A Promising Drone Startup Last October, I highlighted Ondas Holdings Inc. (ONDS), a fast-growing provider of industrial wireless networks and commercial drones. It was the first company to receive certification by the Federal Aviation Administration for an automated aerial security drone and has continued to innovate with new products. Most importantly, the West Palm Beach, Florida-based firm is behind a new “predator drone” system that targets other drones. Using a radar-guided system, Ondas’ experimental product locks onto other drones and fires a ballistic net at its target. A parachute then safely lowers the enemy drone to the ground. This is a surprisingly useful innovation, because it would be madness to fire a flak cannon at an enemy drone flying near critical infrastructure or friendly units. In fact, there have been multiple reports of Russian forces mistakenly shooting down their own aircraft while attempting to repel Ukrainian drone strikes. Ondas solves this problem by using a safer netting system, making it useful near airports, military facilities and public spaces. Shares of the firm have risen 180% since my original article, and there’s likely more room for growth as the firm seeks more bolt-on acquisitions. In late November, for instance, Ondas announced it would acquire Roboteam, a startup involved in developing tactical ground robotics. They aim to create unmanned ground vehicles can be used for explosives ordinance disposal (EOD), route clearance, logistics support, and more. Ondas’ know-how in secure wireless communications should help this team succeed. In addition, Ondas raised $1 billion earlier in January at an excellent valuation of $16.45 per share. This stock-and-warrant offering will help fund an enormous amount of production growth, and management now expects $175 million in revenues in 2026 – a 165% increase from 2025 levels. These are the types of investments that even conservative investors like me tend to appreciate. The company has a rapidly growing backlog (which provides real revenues), and analysts are projecting positive EBITDA profits as soon as 2027. The Biotech Wonders Meanwhile, not every U.S. innovation will involve the military. In fact, Wall Street’s recent focus on defense companies means that some of Luke’s other six sectors have been completely ignored. Here, my favorite sector is biotech, an area that investors often ignore due to its perceived risk. In fact, one of my favorite biotech bets, Greenwich LifeSciences Inc. (GLSI) has already jumped 200% since I called the stock a "Buy" last November. The firm’s flagship therapy previously showed compelling results in its Phase IIb and initial Phase III trials, making it an unusually safer bet for a successful Phase III finale. (I write “safer” becasue there’s no such thing as a sure bet in biotech until regulators give the final seal of approval.) However, as big bets go... that award goes to two companies developing gene-editing platforms -- a technology I believe will power the next generation of innovative drugs. My top pick here is Crispr Therapeutics AG (CRSP), a company founded by the inventors of the “scissors” used by most gene-editing firms. The Swiss company lands among my Top 8 picks for 2026, and shares have already risen 5% since I recommended it several short weeks ago. It is the only gene-editing firm with an approved product on the market, and I expect Crispr’s sickle cell therapy to become a billion-dollar blockbuster in the coming years. My other bet in this space is Intellia Therapeutics Inc. (NTLA), a riskier firm that was forced to pause a clinical trial in October after a patient experienced severe liver injury. Unlike Crispr, Intellia does not have an approved product on the market yet. However, its smaller starting size (its market cap is less than a third of CRSP’s) and 100% ownership of a separate drug, NTLA-2002, give it far greater upside if things go well. Shares rose as much as 147% when I first highlighted it as a potential 1,000% winner last September, and even its clinical trial pause has left its stock 33% higher since last year. The U.S. government is now lending a helping hand to the industry. In November, the Food and Drug Administration (FDA) unveiled a new regulatory roadmap that should turbocharge the development of gene-editing drugs, especially for rarer genetic disorders. Under new rules, drugs that target rarer disorders (or those that must be customized for individual users) may skip large-scale clinical trials entirely. This would be game-changing, because it's often impossible to recruit enough people to run a traditional large-scale trial. In fact, traditional clinical trials are impossible if you only have one patient. That’s why I believe CRSP and NTLA continue to have incredible upside. The U.S. government is starting to uncork innovation in other areas besides AI, and companies like ONDS, CRSP, and NTLA should benefit as a direct result. The Genesis Portfolio Those who follow Luke Lango will know how he’s recommended dozens of innovative stocks long before they hit mainstream media. He's identified companies like: - Celestica Inc. (CLS): +264% since March 2025
- BWX Technologies Inc (BWXT): +143% since February 2024
- Palantir Technologies Inc. (PLTR): +971% since June 2023
These three particular stocks count the U.S. government as a key customer. - Celestica is a crucial supplier of the electronic components found in aircraft, ships, and unmanned vehicles.
- Micro nuclear reactor firm BWXT was recently awarded a $1.6 billion contract to produce high-purity depleted uranium for national defense purposes.
- And Palantir provides software that helps the U.S. military make AI-powered predictions.
That’s put these firms on hypergrowth tracks. In fact, Palantir is expected to grow another 53% this year, thanks to insatiable demand for its AI-powered data analysis. This isn’t the first time the U.S. government has intervened in American industry. During the First and Second World Wars, the federal government coordinated the production of steel, rail, trains, and other critical military inputs. The 1960s Space Race created a whole generation of aerospace tech firms, while the 2008 financial crisis prompted direct government investment in banks, airlines, and carmakers. Now, we’re seeing another concerted effort by the government to remake American businesses. Billions of dollars will get injected into certain companies. And for those seeking an insight into which firms will receive this windfall, watch your inbox on Tuesday, January 27. That’s when we’ll be sending you a direct link to Luke’s free Genesis Mission presentation. I’ll see you back here next week. Thomas Yeung, CFA
Market Analyst, InvestorPlace | 
Post a Comment
Post a Comment