DroneShield Ltd (ASX: DRO) shares are falling again in Thursday's trade.
At the time of writing, the counter-drone technology company's shares are down around 1% and trading at $2.52 each.
Today's decrease is just one of many in a long line of consecutive share price falls.
DroneShield shares are down 24% year to date and 62% from an all-time high recorded in October last year.
Image source: Getty Images
What has happened to the share price?
There has been a significant shift in sentiment around DroneShield shares recently.
After a strong start to the year, when governments around the world hiked their defence budgets, and geopolitical volatility worsened, investors seem to have turned their backs on the stock.
There is now some concern that the company's future growth may not be large enough to justify its share price.
Even a flurry of contract wins hasn't been enough to convince investors.
At the same time, a combination of recent governance and regulatory issues and the cooling of conflict in the Middle East has dragged DroneShield's shares down further.
The stock climbed higher during the first week of May, but then turned again after the company announced that the Australian Securities and Investments Commission (ASIC) had requested DroneShield to provide reasonable assistance in connection with an investigation under the Corporations Act. The investigation relates to market announcements and share trading in November 2025.
All this has happened amid a background of signs of easing conflict in the Middle East. While heightened conflict can increase interest in defence technology, particularly counter-drone systems, signs of easing will do the opposite.
So, is it time to buy in the dip or has the market now lost interest in DroneShield shares?
Here's what the experts think.
Is it time to invest in DroneShield shares? Or should I look elsewhere?
If analyst forecasts are anything to go by, I wouldn't jump at buying $5,000 of DroneShield shares just yet.
TradingView data shows that analysts are sharply divided in their outlook for the counter-drone technology stock over the next 12 months, though they mostly agree there will be some upside ahead.
Out of four analysts, two have a strong buy rating, and two have a sell or strong sell rating.
The average $3.41 target price still implies a potential 35% upside at the time of writing. The maximum $4.80 target price implies that DroneShield shares could jump another 91%, while some are even more bearish, tipping the shares to fall around 9% to $2.28.
Canaccord Genuity is one analyst with a more bullish view on the shares. It renewed its buy rating on Droneshield shares earlier this month, with a 12-month price target of $3.75.
