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Counterdrone Co. Could Have a Record Year

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In addition to launching a new radar detection product and upgrading facilities, DroneShield has received a sizable purchase from the Australian government as it sends aid to Ukraine. Read on to see why one analyst said the company and its stock could be on track for a record year.

DroneShield Ltd. (DRO:ASX; DRSHF:OTC) announced, through a press release, that it has a new long-range radar to add to its product lineup and that it has improved its Blue Mountains research and development testing facility.

The company's new long-range radar, the RPS-82, has "a significantly enhanced radar detection, classification, and tracking range for wide area, multi-mission requirements," according to the company, and the product has been integrated with the company's other products.

Angus Bean, the CTO of DroneShield, commented that "DroneShield is unique globally, in being both a sensor maker and an integrator, developing and manufacturing all of our products, except for the hardware of radars and cameras, where we partner with best-in-breed specialist manufacturers."

Daniel Liang of Bell Potter commented,"The company very well could have a record year."

The upgrades to the company's Blue Mountains facilities are intended to allow more efficient firmware updates for customers and allow the company to adopt a faster turnaround time for development.

A recent press release put out by DroneShield announced that the Australian government is including the company's products in its military aid package to Ukraine. The company reports that the Australian government purchased AU$10.4 million's worth of its counterdrone products, AU$5 million of which was included in the company's quarterly 4C report.

Oleg Vornik, the CEO of DroneShield, commented that "Russian drone attacks on Ukraine have been a regular occurrence since the start of the war. DroneShield is pleased to be supplying our drone detection and defeat systems to Ukraine under this sovereign aid package."

Global Unrest Fuel Defense Budget

On October 25, 2023, McAlinden Research reported that the drone market has been boosted by the interest of the U.S. Army, which is looking to advance its capability to arm small drones while cutting costs.

Peloton Capital 's Darren Odell stated that "DroneShield's repeat contracts with the U.S. government have increased in value over a two-to-three-year span.

The report said that "as an example, an advanced drone like the Switchblade 300, manufactured by AeroVironment, can cost US$6,000 per unit, while improvised FPV drones being utilized on both sides of the Russo-Ukrainian war can deal similar damage to targets at a cost of just US$200 – US$400."

McAlinden also highlighted, in a separate report, rising tensions between Japan, China, North Korea, and South Korea, which have increased the defense budgets of Japan and South Korea. The report stated that "stronger ties between Russia and China, as well as North Korea, have compounded concerns that China may prepare formal action to enforce their territorial claims in Taiwan and the South China Sea. As a result, South Korea and Japan have dedicated particular attention to their armed forces recently."

Company Could Have a Record Year

Daniel Liang of Bell Potter reviewed the company positively on October 24, 2023, and highlighted the company's target share price of AU$0.45, representing a potential 58% return for investors, as the company currently trades at AU$0.28.

Liang commented that "the company very well could have a record year" and that "in the near term, the company could be engaged to deploy its technology at U.S. military bases and/or Australian airports."

A Peloton Capital Report by Darren Odell also rated the company positively, especially as it focused on the company's increase in contracts and revenue growth.

Odell stated that "DroneShield's repeat contracts with the U.S. government have increased in value over a two-to-three-year span. The first one was AU$1M. The next was AU$11M, and the latest was AU$33M."

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DroneShield Ltd. (DRO:ASX; DRSHF:OTC)

*Share Structure as of 10/26/2023

Ownership and Share Structure

Reuters provided a breakdown of the company's ownership and share structure, where management and insiders own approximately 7.4% of the company.

According to Reuters, CEO Oleg Vornik owns 2.46% of the company with 15.03 million shares, Independent Non-Executive Chairman Peter James owns 1.44% of the company with 8.82 million shares, CFO Carla Balanco owns 1.38% of the company with 8.45 million shares, CTO Angus Bean owns 1.21% of the company with 7.39 million shares, and Director Paul Jonathan Shaw owns 0.91% of the company with 5.58 million shares.

Reuters reports that institutions own approximately 7.99% of the company, as Beta Gamma Pty. Ltd. owns 2.21% of the company with 13.50 million shares, Ravenscourt Pty. Ltd. owns 1.31% of the company with 8.00 million shares, S R Bennet Pty. Ltd. owns 0.88% of the company with 5.35 million shares, and P & B Shaw FT CB Pty. Ltd. owns 0.56% of the company with 3.43 million shares.

According to Reuters, there are 611.4 million shares outstanding with 504.53 free float traded shares, and the company has a market cap of CA$102.2 million and trades in the 52-week period between CA$0.18 and CA$0.42.

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Important Disclosures:

  1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of DroneShield Ltd.
  2. Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
  3. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

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