Arxis (ARXS) is well positioned for continued growth through mergers and acquisitions execution and rising demand for defense supply-chain resiliency, RBC Capital Markets said in a Friday note.

The analysts said the company has "materially outperformed" expectations since its initial public offering, driven by successful M&A and stronger-than-expected organic growth across volume, new business, and pricing.

Consensus estimates for 2027 and 2028 do not fully reflect the potential upside from recent acquisitions and continued execution, the analysts added.

The analysts said investors may be increasingly focused on organic growth in H1 2027 as the company faces tougher comparisons and continued market normalization. "However, we believe ARXS remains well positioned to benefit from greater urgency on defense supply chain resiliency and execution," they added.

RBC upgraded Arxis from sector perform to outperform and raised its price target to $60 from $50.

Price: 49.80, Change: +2.28, Percent Change: +4.80