The Electro Optic Systems Holdings Ltd (ASX: EOS) share price is accelerating during early afternoon trade.
The defence contractor’s shares have spent the day firmly in the green while the S&P/ASX 200 Index (ASX: XJO) tanked. The latter is a result of heavy losses on Wall Street overnight, which impacted the ASX.
Nonetheless, Electro Optic Systems shares are currently up 5.67% to $2.05.
For context, the ASX 200 index is down 1.3% to 7,024.7 points.
What’s powering Electro Optic Systems shares ahead?
In today’s statement, Electro Optic Systems advised the successful qualification of its directed energy (DE) drone defence system.
The company’s DE platform uses a powerful laser that is aimed at neutralising swarm drone attacks.
In a recent test, lightweight drones were disabled at an effective rate of 20 drones per minute at ranges beyond 1,000 metres. Notably, this is a new benchmark as no other drone defence system has claimed comparable results.
The DE system has been developed as a key element of the company’s Titanis drone defence system.
While the first group of drones have successfully been eliminated, Electro Optic Systems will now extend to the other groups. This includes much heavier and faster drones such as the ScanEagle and Shadow.
Testing is expected to be conducted at a different location sometime in the third quarter of 2022.
Electro Optic Systems defence systems chief executive, Grant Sanderson commented:
The introduction of the DE capability provides the Titanis drone defence system with multiple options for dealing with each type of drone threat.
EOS DE systems have already demonstrated the ability to disable or degrade a drone’s sensors to prevent intelligence gathering or precision engagement with lethal force by drones. These latest results show that large numbers of drones can be directly neutralised by EOS defensive systems.
…During 2022 a vast amount of military equipment has been destroyed in Ukraine by drones of the type that the Titanis DE drone defence system was developed to protect against.
Drones are highly likely to be used at some time in offensive roles against Australia and its allies, and there is now strong demand for drone defence from customers with current weapon system delivery contracts with EOS.
Electro Optic Systems share price snapshot
The past 12 months have been a turbulent ride for investors, with the company’s shares sinking 50%.
Year to date also hasn’t fared well, down 13%.
Electro Optic Systems commands a market capitalisation of more than $306.35 million and has approximately 151.91 million shares on issue.
The post Here’s why the Electro Optic share price is avoiding the bloodshed today appeared first on The Motley Fool Australia.
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Motley Fool contributor Aaron Teboneras has positions in Electro Optic Systems Holdings Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems Holdings Limited. The Motley Fool Australia has recommended Electro Optic Systems Holdings Limited. 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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