The Electro Optic Systems Holdings Ltd (ASX: EOS) share price has been a big mover on Monday.
At one stage this morning, the defence and communications company’s shares were up 53% to 70 cents.
The EOS share price has now pulled back but remains up 28% to 58 cents.
Why is the EOS share price racing higher?
Investors have been buying the companyâs shares today after it announced a major contract win.
According to the release, EOSâ Defence Systems business has secured a contract with SpetsTechnoExport (STE), a Ukrainian state-owned foreign trade enterprise.
EOS will supply STE with up to one hundred EOS heavy remote weapon systems (RWS), including spares and related services, for use in Ukraine. The contract is valued at up to US$80 million (approximately A$120 million) and is expected to be supplied during 2023 and 2024.
EOSâ RWS is a long-established product and is designed to deliver greater accuracy and reliability than any competitor system. Over 2,500 units have been sold and it is currently in use with several military services in Australia, North America, Europe and South-East Asia.
Whatâs next?
It is worth noting that the contract is not yet binding. It remains conditional on demonstration testing and is subject to other customary terms for military contracts. In addition, consistent with typical wartime contract arrangements, the contract is also subject to conditional early termination rights in favour of STE.
Pleasingly, management revealed that this may not be the final contract. It advised that it continues to work on other opportunities relating to Ukraine, including opportunities for direct supply to the country, and to other countries providing support to Ukraine.
However, it has warned that there is no certainty that any particular outcome or transaction will result from these discussions. EOS will keep the market updated as appropriate.
The post Electro Optic Systems share price rockets 53% on Ukraine deal appeared first on The Motley Fool Australia.
Should you invest $1,000 in Electro Optic Systems Holdings Limited right now?
Before you consider Electro Optic Systems Holdings Limited, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Electro Optic Systems Holdings Limited wasn’t one of them.
The online investing service heâs run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
See The 5 Stocks
*Returns as of March 1 2023
(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}
setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()
More reading
- Why are ASX 200 energy shares off to such a great start on Monday?
- Guess which ASX 300 lithium director just doubled their holding of company shares
- Why is the Lake Resources share price rocketing 19% on Monday?
- Coles share price climbs following $100 million acquisition
- This ASX All Ords share could pay a 16% dividend yield by 2025
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems. The Motley Fool Australia has no position in any of the stocks mentioned. 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 https://ift.tt/E9ukZj0
Leave a Reply