‘Rapidly increasing demand’: DroneShield (ASX:DRO) shares jump 5%

What did DroneShield announce?

| More on:
rising asx share price represented by drone flying in the air

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • DroneShield shares lift 5.88% to 18 cents 
  • The company won a $2 million contract from an international government agency 
  • Potential recurring subscription, however the value is unable to be estimated at this time 

The DroneShield Ltd (ASX: DRO) share price is lifting off in mid-afternoon trade. This comes after the defence contractor announced another contract award.

At the time of writing, DroneShield shares are swapping hands for 18 cents apiece, up 5.88%.

DroneShield secures defence contract

Investors are buying up DroneShield shares after the company updated the market with a positive release.

In a statement to the ASX, DroneShield advised it has received an order for several of its systems from an ‘international government agency’.

The deal, valued at around $2 million, represents ongoing commitments from government agencies, which have sought DroneShield products in the past.

The funds will be received across the March 2022 and June 2022 quarters.

The order consists of an upfront purchase of $2 million with an additional recurring subscription element. Although, DroneShield stated that the latter cannot be estimated at this time, but is expected to be material.

DroneShield CEO, Oleg Vornik commented:

As drones continue to be increasingly used in modern warfare, we are seeing rapidly increasing demand for the DroneShield equipment. With the substantial investment in inventory over the last 12 months, ability to rapidly fulfil orders remains critical in current environment, and we are well placed.

What does DroneShield do?

DroneShield specialises in drone security technology. The company designs and develops detection systems that use specialised technology to protect people, organisations and critical infrastructure.

Its multi-layered products are centred around detection and disruption from unmanned aerial systems (UAS).

Its key product is the DroneGun, which is a hand-held, lightweight portable weapon that is highly effective against drones.

DroneShield share price summary

Over the past 9 months, DroneShield shares have been moving in a sideways channel from 16.5 cents to 19 cents.

In 2022, the company’s share price is up almost 3% and up 9% in the last month alone.

With a market capitalisation of $75.28 million, DroneShield has room to grow and cement itself as a leading defence contractor.

The company holds more than 418.22 million shares on its registry.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended DroneShield Ltd. The Motley Fool Australia has recommended DroneShield Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Technology Shares

An analyst wearing a dark blue shirt and glasses sits at his computer with his chin resting on his hands as he looks at the CBA share price movement today
Technology Shares

Here’s what Goldman Sachs thinks of the Xero share price

What's being said about Xero's shares this week?

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Earnings Results

Nuix share price tumbles following $23m loss in FY22

Nuix shares dropped into the red on Thursday...

Read more »

Young man in shirt and tie staring at his laptop screen watching the Paladin Energy share price tank today
Earnings Results

Codan share price sinks 10% despite record profit

How did Codan track for the 2022 financial year?

Read more »

A gold bear and bull face off on a share market chart
Technology Shares

Does the bull beat the bear for this ASX tech share?

Let's take a look at the bull and bear cases for this ASX tech share.

Read more »

A boy is about to rocket from a copper-coloured field of hay into the sky.
Technology Shares

Guess which ASX tech share is soaring 16% on a new Google deal

This tech share has had a great past 12 months.

Read more »

Man ponders a receipt as he looks at his laptop.
Technology Shares

Xero share price dips 5% on weaker UK performance

The ASX market darling is feeling the heat after providing an update at its AGM.

Read more »

a man sits in casual clothes in front of a computer amid graphic images of data superimposed on the image, as though he is engaged in IT or hacking activities.
Earnings Results

Data#3 share price dips despite 19% leap in FY22 dividend

The ASX tech share said ongoing supply chain issues had impacted its performance over the year.

Read more »

A hipster looking man with bushy beard and multiple arm tattoos sits on the floor against a sofa reading a tablet with his hand on his chin as though he is deep in thought.
Industrials Shares

Why did the Novonix share price nosedive 6% today?

We check what happened to shares in the battery material technology company on Wednesday.

Read more »