Why I'd buy DroneShield shares in May

Counter-drone systems could become a more normal part of defence, infrastructure, and security spending over time.

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ASX growth shares can be volatile, but I think some are still worth considering when they are exposed to powerful long-term trends.

One share that stands out to me is DroneShield Ltd (ASX: DRO).

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Image source: Getty Images

A counter-drone specialist

DroneShield is not a traditional defence company.

It does not build ships, fighter jets, or tanks. It develops counter-drone and electronic warfare technology, helping customers detect, track, and respond to drone threats.

I think that makes it one of the more interesting ASX growth shares today.

Drones are changing modern conflict and security planning. They are relatively cheap, increasingly capable, and can be used in ways that create serious challenges for defence forces, airports, prisons, public events, and critical infrastructure.

That is where DroneShield's opportunity comes from.

A market with a long runway

What I like about DroneShield is that counter-drone technology could become far more mainstream over the next decade.

This is no longer a niche issue limited to one battlefield. Governments, military customers, and security organisations are having to rethink how they protect people, assets, and infrastructure from unmanned systems.

In my view, that gives DroneShield a large and expanding addressable market.

The company has already shown it can win attention in a fast-growing category. The next step is execution. It needs to keep converting demand into contracts, scaling production, maintaining technology leadership, and deepening customer relationships.

If it can do that, I think the business could be much larger in five or 10 years.

It can be volatile

I would not describe DroneShield as a quiet blue-chip investment.

The share price can move sharply, contract timing can be uneven, competition could increase, and the market may punish the stock if growth does not meet expectations.

That is why I would treat it as a higher-risk growth share rather than a core portfolio holding.

Even so, I think it remains worth considering.

The appeal is the combination of a powerful defence trend, specialist technology, and the possibility of strong long-term revenue growth if customer adoption keeps building.

I would not rely on DroneShield for dividends or stability. But I would be willing to own it for growth.

If counter-drone technology becomes a standard part of military and security spending, I think DroneShield could be well placed to benefit.

Foolish takeaway

DroneShield shares will not suit every investor.

The company still needs to prove that it can turn a strong thematic position into durable earnings growth.

But I think the long-term opportunity is compelling. Drones are changing the security landscape, and the need for counter-drone systems could keep rising for many years.

For investors comfortable with higher risk, I would be happy to consider buying DroneShield shares today.

Motley Fool contributor Grace Alvino has positions in DroneShield. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield. 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.

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