Ondas (ONDS) announced some new deals last week and expects strong order flow to continue, reflecting upside to H2 and longer-term estimates, Oppenheimer said in a Monday note.

Valuation starts looking "very attractive" 2-years out as Ondas rapidly scales from zero to a $1 billion business with first-mover advantage, a solid balance sheet and manufacturing capacity to meet growing demand, Oppenheimer added.

The Pentagon is looking to expand autonomous capabilities with a proposed investment of $54.6 billion in 2027, according to the note. The company is also making strides with the US government via its Palantir (PLTR) partnership and Mistral merger, the firm highlighted.

The collaboration will layer Palantir's artificial intelligence platform across Ondas' autonomous drone and counter-drone systems and World View's Stratollite balloon platform, forming a unified command-and-control infrastructure, the firm noted. Integration across the wider Ondas portfolio is expected as soon as Q4, according to the note.

The company's ONBERG JV with Heidelberg in Germany could be an entry point into the Ukraine market, with controlled downside if the war were to end due to its limited exposure, the brokerage added.

Oppenheimer maintained an outperform rating on Ondas with a price target of $16.

Price: 10.65, Change: +0.65, Percent Change: +6.48