Up to 400% higher and set to keep going. What are the best ASX defence stocks to buy right now?

The popularity of defence stocks is surging.

| More on:

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 is experiencing strong interest due to its expansion plans, including a new $13 million R&D facility, joining the ASX 200, and securing significant contracts with the U.S. Department of Defense.
  • Electro Optic Systems is showing strong performance with a new $108 million contract for its remote weapon system. 
  • Titomic is noted for its metal additive manufacturing capabilities with a 37% revenue increase. 

ASX defence stocks are in the spotlight as geopolitical tensions continue to ramp up and governments raise their budgets for defence spending.

The shift in sentiment has attracted a lot of investors to the sector too, with some stocks seeing impressive share price surges.

And it's not too late to jump on board.

Here's a rundown of the best ASX defence stocks to buy right now.

Military soldier standing with army land vehicle as helicopters fly overhead.

Image source: Getty Images

Droneshield Ltd (ASX: DRO)

Droneshield shares have attracted a lot of attention recently. The company announced plans this week to build a new $13 million counter-drone research and development facility in South Australia, doubling its employee numbers to 400.

In September, the counter-drone technology company joined the ASX 200 Index and also released a sales update

Droneshield has surpassed 4,000 systems sold worldwide with the receipt of a package of two standalone contracts totalling $7.9 million for handheld systems for delivery to the U.S. Department of Defense.

At the time of writing on Wednesday morning, Droneshield shares are 2.97% lower and changing hands for $5.88 a piece. Droneshield's share price has jumped 84.6% over the past month and is now a huge 337.8% higher over the past year.

Earlier this month, Bell Potter listed Droneshield shares as one of its best buys, commenting that the ASX stock is in a strong position in a booming industry. 

Electro Optic Systems Hldgs Ltd (ASX: EOS)

EOS has been another strong performer this year thanks to strong revenue growth and tailwinds in the defence sector.

The company has seen some big contract wins too. Most recently, it announced a new contract win worth $108 million for its remote weapon system, which means there could easily be much more upside for the stock to come.

At the time of writing, EOS shares are trading 6.75% lower at $8.01 a piece. For the year, the share price is an enormous 399.07% higher.

Yesterday, Bell Potter updated its price guidance on the shares. The broker confirmed its buy rating on the ASX tech stock and raised its price target to $11.20 (up from $11.00 previously). That represents a potential 39.8% upside for investors over the next 12 months.

Titomic Ltd (ASX: TTT)

Titomic is another great defence stock buy. The company specialises in metal additive manufacturing (cold spray technology), which has applications in defence (and other markets). 

There has been no major news out of the company recently, but it announced a strong 37% increase in revenue for FY25 in August. 

At the time of writing, the Titomic share price is down 2.99% to 32.5 cents. For the year, the share price has surged 170.83%.

Bell Potter is optimistic that the share price will keep rising, too. In July, the broker placed a speculative buy rating and 50-cent price target on Titomic shares. That represents a potential 53.85% upside for investors over the next 12 months.

Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield and Electro Optic Systems. 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 AI Stocks

A humanoid robot is pictured looking at a share price chart
AI Stocks

3 reasons this AI and Robotics ASX ETF is a long term play

Is now the time to invest in robotics and AI?

Read more »

Man with virtual white circles on his eye and AI written on top, symbolising artificial intelligence.
AI Stocks

AI may look like a bubble. But what about Block shares?

Here's what to expect from this AI-driven tech stock next.

Read more »

AI written in blue on a digital chip.
AI Stocks

2 amazing AI stocks to buy in the ASX 200

These stocks appear well-positioned to benefit from the AI boom.

Read more »

A happy family of four on holidays stand on a jetty and cheer.
Broker Notes

Down 40% in 2026, should you buy the big dip in Life360 shares?

A leading analyst offers his outlook for Life360 shares.

Read more »

Buy and sell on yellow paper with pins on them and several share price lines.
Broker Notes

Sell alert! Why this expert is calling time on Nuix and Brainchip shares

A leading analyst forecasts more pain to come for Brainchip and Nuix shares. But why?

Read more »

Human head and artificial intelligence head side by side.
AI Stocks

3 ASX growth shares that could benefit from the AI boom

Let's see which shares could benefit from this transformational technology.

Read more »

A young woman with her mouth open and her hands out showing surprise and delight as uranium share prices skyrocket
Growth Shares

$10,000 invested in Droneshield and Woodside shares just 1 week ago is now worth…

And here's what the analysts expect from these two ASX 200 stocks next.

Read more »

Red buy button on an Apple keyboard with a finger on it.
AI Stocks

3 reasons to buy the big dip on WiseTech shares today

A leading investment expert forecasts a big turnaround for WiseTech’s beaten down shares.

Read more »