The DroneShield share price has tumbled 21% in a month. What’s next?

drone stuck in a tree representing crashing Aerometrix share pricedrone stuck in a tree representing crashing Aerometrix share price

The DroneShield Ltd (ASX: DRO) share price has failed to take off in the past month.

Investor sentiment is waning off on the drone security company as the ASX heads towards bear market territory.

While DroneShield shares finished flat at 18 cents at yesterday’s market close, they are down 21% in a month.

In contrast, the All Ordinaires (ASX: XAO) is down 7% over the same time frame.

What’s dragging DroneShield shares lower?

The DroneShield share price has tumbled in recent times despite the current hype surrounding demand for drone technology products.

The Russian war in Ukraine has highlighted the importance for any military wishing to counter unmanned aerial systems (UAS).

However, sky-rocketing inflation along with a potential global economic slowdown has put a strain on DroneShield shares. This is because if the world does head into a recession next year as economists are predicting, countries will likely tighten up military spending.

Nonetheless, when war breaks out, DroneShield benefits from this just as it did from Ukraine.

The company supplied hand-held detection drone devices as well as its prized drone gun to the besieged country.

With further contracts possibly in the works, DroneShield shares could receive a much welcome boost.

What’s next for the company?

DroneShield put out a release yesterday advising that its equipment has been deployed at the World Economic Forum (WEF).

Located in Switzerland and held between 22 –26 May, this could be an opportune time to showcase its products.

The event attracts over 2,500 participants including world leaders and senior business executives.

DroneShield CEO, Oleg Vornik provided a brief outlook on the future, saying:

…The company continues to increase its presence in the tier 1 global events sector, as well as increasing the profile of the products with other key customers such as law enforcement and military personnel.

As stated in its quarterly results in April, the company has a sales pipeline of $155 million for 2022. This is expected to increase to $175 million in the following year, cementing its place in the multi-billion counter-drone market.

DroneShield share price snapshot

Despite its recent fall, the DroneShield share price is up around 9% from this time 12 months ago.

The company’s shares reached a 52-week high of 30 cents in early May before retracing 40% to current levels.

DroneShield has a market capitalisation of roughly $84.35 million, with approximately 432.54 million shares on its books.

The post The DroneShield share price has tumbled 21% in a month. What’s next? appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.* Scott just revealed what he believes could be the “five best ASX stocks” for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now

See The 5 Stocks
*Returns as of January 12th 2022

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];[property] = defaultValue;

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);

More reading

Motley Fool contributor Aaron Teboneras has positions in DroneShield Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield Ltd. The Motley Fool Australia has recommended DroneShield Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s