Momentum of Counterdrone Solutions Co. Speeds Up in June
Research Report

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Disclosures for Shaw and Partners, DroneShield Ltd., June 25, 2025

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DroneShield Ltd.'s (DRO:ASX; DRSHF:OTC) secured 2025 revenue just jumped about 60% with a new order in a record amount of AU$61.6 million (AU$61.6M), reported Shaw and Partners Senior Analyst Abraham Akra in a June 25 research note. Shaw and Partners raised its target price on the defense manufacturer by 67%.

"DroneShield's June update shows momentum accelerating," Akra wrote.

Share Price Surpasses Target

Shaw and Partners' new target price on the counterdrone solutions firm is AU$2 per share, previously AU$1.20, the analyst noted. In comparison, at the time of Akra's report, DroneShield was trading at about AU$2.14 per share, already having climbed 7% higher than the new target.

DroneShield remains rated Hold.

Recent Performance Notable

Akra reported that DroneShield's secured income, project pipeline and wins all grew substantially during the past month.

The new order in late June and some smaller ones took DroneShield's year-to-date (YTD) secured income to AU$161 million (AU$161M), already more than double total revenue in 2024 (AU$57.5M). In May the company already had generated AU$100.4M of YTD revenue.

As for the company's project pipeline, it grew 3% between May and June, to AU$2.41 billion (AU$2.41B) from AU$2.34B in May. This reflected an increase in the number of projects to 268 from 256.

This shows "broader customer base and greater repeat order potential," Akra wrote.

YTD wins mounted to AU$131.7M from AU$41.3M between the company's annual general meeting on May 25 and late June.

"That tripling of wins inside six weeks underscores a pivotal transition from evaluation sales to volume deployments by blue chip militaries," noted Akra.

The analyst pointed out that DroneShield, now with 234 engineers, a set of plants in Sydney and two manufacturing partners, has the capacity to fulfill up to AU$500M worth of orders annually.

Strong Cash Position

As for available cash, DroneShield remains well-positioned even though the total amount decreased 7% between May 20 and June 20, to AU$198M from AU$213M. This likely was due to the company spending on parts that take longer to procure, to beef up its inventory.

"With zero debt, the company still carries about 10 quarters of fixed costs (AU$6.5M baseline fixed cash operating costs per month), leaving room for research and development (R&D), capacity and potential bolt-ons without returning to the equity market," wrote Akra. DroneShield spends about AU$50M per year on R&D.

European Footprint Expands

Due to the new AU$61.6M order and NATO's rearmament spending, Europe recently became a larger market for DroneShield. Between February 25 and late June, the company's pipeline of European projects expanded in value to AU$1,100M from AU$382M. Now, 46% of DroneShield's active projects are for European customers.

"Management therefore reaffirms plans for a continental assembly hub to cut lead times, safeguard margins and satisfy local content rules tied to ReArm [Europe] funding," Akra wrote.

Company's New Estimates

The analyst reported that DroneShield increased its revenue forecasts for 2025, 2026 and 2027 to AU$206M, up 63.1%; AU$232.9M, up 60.4%; and AU$277.2M, up 57.2%.

The company's new EBITDA projections for the same years are AU$49M, up 129.9%; AU$67.2M, up 85.6%; and AU$102.3M, up 63.7%.

More Stock Specifics

Akra reported that at the time of his report, DroneShield has a market cap of AU$1.9B and a 52-week range of AU$0.59–2.60 per share.

The company's major shareholders are Regal Funds Management Pty. Ltd. with 9.4%, The Vanguard Group Inc. with 5.5%, State Street Global Advisors, Australia with 4.1%, Epirus Inc. with 2.1% and Charles Barrington Goode also with 2.1%.