DroneShield Ltd. (DRO:ASX; DRSHF:OTC) received a new order for US$11 million ($11M) worth of its counterdrone defense solutions, and consequently, Bell Potter raised its target price on the Australian firm to US$0.34 per share from US$0.32, reported analyst Daniel Laing in a Jan. 9 research note.
"Positively, this contract is from a completely different customer to the Dec. 22 order, demonstrating significant demand for the company's products from a variety of sources," Laing wrote. The previous order also was for US$11M.
With these two contracts, Laing pointed out, DroneShield has about US$16.5M in contracted revenue for 2023. This amount equates to 62% of Bell Potter's US$26.5M revenue estimate for the defense manufacturer in 2023.
Whereas Bell Potter did not change any of its 2023 estimates for DroneShield after this order, it did update each valuation used in calculating its price target. This resulted in the US$0.02, or 6.25%, bump up. This new target is US$0.34 per share; the current share price is about US$0.01225.
Bell Potter also maintained its Buy recommendation on DroneShield.
The investment and financial advisory firm made these adjustments, Laing explained, "to reflect improved confidence in the sales pipeline and significant derisking of our forecasts considering the contracted revenue for the calendar year 2023."
Bell Potter also maintained its Buy recommendation on DroneShield.
In other recent news, which Laing relayed, DroneShield successfully deployed its DroneGun Tactical at the recent Brazilian presidential inauguration. It also finished the artificial intelligence-focused Defence Innovation Hub Project.
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Disclosures For Bell Potter, DroneShield Ltd., January 9, 2023
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