It certainly has been a very tough time for DroneShield Ltd (ASX: DRO) shares.
After hitting a record high of $6.71 in October, the counter drone technology company's shares have lost 75% of their value and currently trade at $1.68.
While this is disappointing for shareholders, it could be a buying opportunity for the rest of us according to one analyst.
Should you buy the dip?
This morning, investment advisory and portfolio management company, MPC Markets, named DroneShield shares as a buy, courtesy of The Bull.
It believes that the company's shares are now trading at a "reasonable price" given its strong growth potential. MPC Markets said:
The company provides artificial intelligence based platforms for protection against advanced threats, such as drones and autonomous systems. The shares had enjoyed a strong run, rising from 76 cents on January 3 to close at $6.60 on October 9, driven by new deals with foreign governments and growth forecasts. The shares fell to $2.25 on November 13 and were trading at $2.095 on November 19.
Investors sold their shares after disclosures to the ASX revealed DRO directors had been selling their holdings. The company generated strong revenue in the third quarter of fiscal year 2025 and has a strong contract pipeline across government and military sectors. The shares are trading at a reasonable price for a company with growth prospects.
Is anyone else bullish on DroneShield shares?
The team at Bell Potter remains very bullish on the counter drone technology company and is recommending it to clients.
Earlier this month, the broker reiterated its buy rating and $5.30 price target on its shares. Based on its current share price, this implies potential upside of 215% over the next 12 months.
The broker believes that DroneShield is well-placed to win significant contracts from its $2,550 million sales pipeline over the coming quarters. It said:
We believe DRO has the market leading counter-drone offering and a strengthening competitive advantage owing to its years of experience and large R&D team, focused on detect and defeat capabilities. We expect 2026 will be an inflection point for the global counter-drone industry with countries poised to unleash a wave of spending on soft-kill detect and defeat solutions. Consequently, we believe DRO should see material contracts flowing from its $2,550m potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26.
