The AML3D share price has crashed 26% this week. Time to pounce on the ASX defence stock?

The AML3D share price is roaring back today but still down 26% since Monday's open.

The AML3D Ltd (ASX: AL3) share price has been on quite a rollercoaster over the past six trading days.

And that's no hyperbole.

Here's how the AML3D share price has moved as of last Wednesday:

  • On 3 July shares closed up 37.8%
  • On 4 July shares closed up 25.9%
  • On 5 July shares closed up 26.5%
  • On 8 July shares closed down 14.0%
  • On 9 July shares closed down 21.6%

As for today, shares in the ASX defence stock are once more tearing higher, up 17.2% at 17 cents apiece.

Now that sees the stock up 234% over 12 months.

But it still leaves the AML3D share price down 26.1% since Monday's open.

Time to pounce?

A young woman sits at her desk in deep contemplation with her hand to her chin while seriously considering information she is reading on her laptop.

Image source: Getty Images

What's been lifting the AML3D share price?

If you're not familiar with the company, the ASX microcap stock is engaged in the design and construction of 3D parts using metal additive manufacturing technology, with a focus on the defence industry.

And the AML3D share price has been enjoying a strong run following a series of new contracts.

Back on 16 August, the company signed a contract valued at more than $2 million with BlueForge Alliance to develop and 3D print a metal replacement component used in United States Navy submarines.

And the new contract announcements have continued apace.

On 1 May, the company reported inking a $350,000 deal with the Australian government for a six-part nozzle assembly in an aerospace defence project.

On 20 May, AML3D announced another deal linked to the US Navy involving the lease of two more of its ARCEMY metal 3D printing systems with option to purchase. That deal has an initial value of $700,000. The AML3D share price closed up 17.9% on the day of the announcement.

Commenting on that deal at the time, AML3D CEO Sean Ebert said it "illustrates how important our advanced manufacturing technology is to the US Defence sector".

He added:

AML3D ARCEMY systems can produce higher quality components, faster and with less waste than traditional manufacturing which is driving demand from the US Navy and the wider US Navy submarine industrial base supply chain.

Price query

Today the company responded to a 5 July price query from the ASX regarding the soaring AML3D share price and surge in trading volume last week.

The ASX had questions about AML3D's announcement on 2 July when the company reported on a new $1.1 million sale of its ARCEMY system to US Navy supplies Laser Welding Solutions.

AML3D replied to the ASX query about the announcement, stating:

Not only was the ARCEMY System sale a material sale for the company, but the election to purchase the previously leased system was directly related to previous announcements on 20 September 2023 and 20 May 2024.

Is the AML3D share price good value now?

The past few days of selling were likely driven by some healthy profit-taking after the huge run higher in the AML3D share price.

Today, it appears that speculative bargain hunters are back in the game, driving shares higher once more.

With the share price still down 26% since Monday's open, it's quite possible investor enthusiasm could send it back to Monday's levels, or higher, in the days ahead. Though that's far from guaranteed.

Longer term, the global defence sector is expected to continue growing strongly amid ongoing and rising tensions around the world.

If AML3D can continue to secure a foothold in that multi-billion-dollar industry with additional and continuing defence contracts, I expect shareholders to be amply rewarded.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Technology Shares

Sell written several times on board.
Broker Notes

Sell alert! Why this expert is calling time on Life360 and Xero shares

A leading expert forecasts more losses ahead for Xero and Life360 shares.

Read more »

Man looking at digital holograms of graphs, charts, and data.
Technology Shares

Which ASX tech stock is up more than 30% after revealing a deal with the FBI?

This junior technology company has made a strong start to the year.

Read more »

A silhouette of a soldier flying a drone at sunset.
Technology Shares

This ASX tech company just surged past the $10 billion valuation mark after a major profit upgrade

Demand for drones has led to surging revenues.

Read more »

Woman with her fingers crossed and eyes shut.
Technology Shares

Megaport shares on watch after locking in almost $1 billion of new AI deals

The tech company has delivered another round of big updates.

Read more »

Man looking happy and excited as he looks at his mobile phone.
Technology Shares

Megaport lifts FY27 outlook after landing $1B in new AI infrastructure deals

Megaport wins nearly $1B in AI contracts, lifts FY27 guidance on growth in recurring revenue and major new deals.

Read more »

Businesswoman with a pleased smile reading on her laptop at a desk in the office with a look of satisfaction.
Technology Shares

Codan trading update: Record H1 FY27 profit and revenue

Codan Limited shares are in focus as the company posts sharp H1 FY27 profits, powered by record Communications segment growth.

Read more »

A woman with strawberry blonde hair has a huge smile on her face and fist pumps the air having seen good news on her phone.
Technology Shares

Codan vs Megaport: Which ASX Tech Stock Has More Upside?

Codan or Megaport? I break down both ASX tech stocks for upside, valuation, and momentum to reveal my pick for…

Read more »

Woman on her phone with diagrams of tech sector related elements linking with each other.
Technology Shares

TechnologyOne vs Life360: Which ASX tech share has more upside?

Weighing up TechnologyOne and Life360 shares? See the numbers, latest performance, and why I think one offers more upside than…

Read more »