Author: openjargon

If an ASX investor is on the hunt for their next dividend share, they might be drawn to the financial sector of the Australian markets. ASX financial shares have long been known for their hefty dividend potential, mainly thanks to the generosity of the ASX bank shares. AMP Ltd (ASX: AMP) is a financial share, and does have a banking division. But does this make the company a sound dividend investment?

AMP is one of the ASX’s most interesting stocks, at least in my view.

This company has had quite the journey since demutualising and floating on the ASX back in the late 1990s. Unfortunately, it has been a rather arduous journey for most of the past two and a half decades. The company once commanded a price of almost $15 a share back in its early ASX days. However, chronic mismanagement and a series of scandals proved to be catastrophic for those investors who received AMP shares as part of their demutualisation. Since January 1999, the AMP share price has collapsed by more than 87%. That’s a pretty rough return for more than 27 years of waiting.

More recently, though, AMP seems to have at least steadied the ship. At $1.70 a share today (at the time of writing), AMP is up about 14.5% over the past 12 months, and up by more than 54% since mid 2021.

But how does this financial stock measure up when it comes to dividend income? Can it rival its larger and more popular peer in the financial space?

AMP shares: What kind of dividends are on offer today?

At today’s price of $1.70 a share, AMP stock is trading on a trailing yield of 2.37%. That stems from the last two dividends the company has paid out. The first of those was the final dividend worth 2 cents per share that we saw doled out back in April. The second was the interim dividend from September, also worth 2 cents per share. Both payments came partially franked at 20%.

The final dividend was a particularly welcome one, as it represented a 100% increase on the 1 cent per share payout investors bagged in April 2025.

Saying that, investors have had better in the past. For example, 2023 saw shareholders receive two payments worth 2.5 cents per share each.

Still, AMP’s relatively low yield and lack of full franking do arguably make the company uncompetitive in the ASX financial space when it comes to dividends. At least where things currently stand.

Who knows what the future might hold, though. As my Fool colleague Samantha recently covered, many ASX brokers are bullish on AMP shares right now. Perhaps the company will keep improving its income offerings to investors going forward. We’ll have to wait and see.

The post Buying AMP shares? Here’s the dividend yield you’ll get today appeared first on The Motley Fool Australia.

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• 5 best ASX 200 financial shares of FY26
• Are AMP shares a good buy for passive income?
• Here are the top 10 ASX 200 shares today
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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

The Xero Ltd (ASX: XRO) share price is sliding again on Monday following a new announcement from the accounting software company.

At the time of writing, Xero shares are down 4.24% to $70.29. The S&P/ASX All Technology Index (ASX: XTX) is also lower, although its 1.33% fall is much smaller.

The latest drop adds to a painful year for shareholders. Xero shares have now fallen almost 40% in 2026 and around 60% over the past 12 months.

Here’s the latest.

CEO sells remaining ordinary shares

According to the release, Singh Cassidy sold 29,608 Xero shares on market on 7 July at $74 apiece.

The transaction was worth just over $2.19 million, with Xero saying the sale was made to manage personal tax obligations.

Interestingly, the sale means Singh Cassidy no longer holds any ordinary Xero shares directly. However, she still has plenty riding on the company through 171,381 restricted stock units and 1,038,308 unlisted options.

Those holdings leave her with plenty of exposure to how Xero performs from here.

More than $7.5 million sold since May

The latest sale follows another large disposal by Singh Cassidy only a few weeks earlier.

Between 26 May and 2 June, she sold 70,737 Xero shares for around $5.4 million. Xero also said those sales were made to cover tax obligations.

Combined, the two transactions have seen the Chief Executive sell 100,345 shares worth roughly $7.6 million since late May.

Both sales have been linked to tax obligations, but the timing isn’t a great look when Xero shares are already trading near their 52-week low of $65.

Strong growth has not stopped the slide

Xero’s share price had already been falling despite solid growth in the underlying business.

Its FY26 result showed operating revenue rising 31% to NZ$2.75 billion, while adjusted EBITDA increased 18% to NZ$757.4 million. Net profit fell 27% to NZ$167.4 million as acquisition costs linked to US payments business Melio weighed on the result.

Management expects FY27 operating revenue of between NZ$3.62 billion and NZ$3.73 billion. Adjusted EBITDA is forecast to reach NZ$860 million to NZ$920 million.

Why are Xero shares falling?

Today’s CEO sale seems be adding to the selling, while the weaker tech sector is also working against the stock.

However, the 60% decline over the past year points to much bigger concerns.

Investors are weighing the price paid for Melio, higher costs, and the time needed to turn faster US growth into stronger profits.

The business is still growing revenue and customers, but the market wants to see more of that growth flow through to the bottom line.

The post Another CEO share sale has this ASX 100 tech stock sinking today appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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 Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Silex Systems Ltd (ASX: SLX) is an interesting company in that it’s aspiring to be part of the uranium supply chain, but on the technology front rather than the mining front.

Uranium technology delivering results

The company is focused on commercialising the Silex laser isotope separation technology, which can be used to produce different grades of fuel for the nuclear power industry.

The company held an investor day recently where it invited analysts, including those from Shaw and Partners, to visit its facilities at Lucas Heights in New South Wales.

Shaw and Partners said in a note to clients following the visit:

Silex management outlined the progress post achieving Technology Readiness Level 6 (TRL-6) last year. The first phase of commercialisation is reprocessing tails at the Paducah facility in Kentucky. Silex is on track for first production of uranium in 2030. On the site visit we also saw the zero spin silicon enrichment project in dry commissioning.

The Silex technology is owned by a joint venture company, Global Laser Enrichment (GLE), which is 51% owned by Silex and 49% owned by uranium major Cameco.

Shaw and Partners said the achievement of TRL-6, “started the clock ticking on Cameco’s option to acquire a 26% stake in GLE to move to 75% ownership”.

They added:

Cameco now has 30 months to make a decision. We note that Cameco is making increasingly optimistic comments about GLE on its result calls. We hosted a call with Cameco early this week at which Cameco repeated its optimism on the GLE technology.

Shaw and Partners said the Silex technology had the potential to re-enrich about 150 million pounds of previously processed uranium tailings back into mine-grade uranium.

They added:

One way to think about this opportunity is that (the Paducah facility) I will be a 5Mlb/yr uranium mine producing uranium at a cash cost of less than US$30/lb. For reference, Paladin’s Langer Heinrich operation is expected to produce 5-6Mlb of uranium at a cash cost in the high US$30s/lb once at full operation.

Silicon also a potentially large oppportunity

The company also announced on 29 June the construction of the world’s first laser-based silicon enrichment plant.

The company said:

Enriched silicon-28 in the form of high-purity Q-Si is required for next-generation silicon-based quantum computers being developed by advanced semiconductor companies around the world. Quantum computers, the first of which are expected to be commercialised by the end of the decade, could revolutionise the computing industry by providing an immense increase in computing power, compared to today’s most advanced classical chips made by companies such as Nvidia, Intel, IBM and AMD. Quantum computing is therefore expected to underpin a transformational performance uplift in the emerging Artificial Intelligence (AI) industry.

Shaw and Partners has a price target of $12.80 on Silex shares compared to $5.74 currently.

The company is valued at $1.59 billion.

The post This ASX uranium company could jump more than 100% in value: Broker appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England 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 Advanced Micro Devices, Cameco, Intel, International Business Machines, and Nvidia. The Motley Fool Australia has recommended Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

FleetPartners Group Ltd (ASX: FPR) shares are starting the week on the front foot.

At the time of writing, the FleetPartners share price is up 3.02% to $3.07.

The latest gain takes the ASX financial stock’s rise in 2026 to around 9%.

FleetPartners provides vehicle leasing, fleet management, and salary packaging services across Australia and New Zealand.

Investors are responding to the company’s third-quarter business update released this morning.

Here’s what FleetPartners reported.

New business growth picks up

FleetPartners said new business written rose 8% during the 9 months to June compared with the same period last year.

Growth accelerated during the third quarter, with new business written up 24% from a year earlier. The company wrote $246 million of new business during the quarter.

FleetPartners also completed $14 million of sale-and-leaseback transactions, while its June pipeline was 27% above the average level recorded during the first half.

The stronger result has prompted management to upgrade its FY26 new business written outlook from marginal growth to high-single-digit growth.

The company said the economic environment remains challenging, but new customer wins, contract renewals, and continued growth from smaller fleet customers are supporting the pipeline.

Core income continues to rise

Assets under management or financed (AUMOF) increased 6% year to date, while core income grew 7%.

FleetPartners had around 67,000 funded vehicles at the end of June, up 2% from March.

The novated leasing business also performed well, with new business written rising 20% from the prior corresponding period.

Management said stronger electric vehicle demand, increased sales activity, and the acquisition of Remunerator supported the growth.

The company still expects AUMOF to grow at a mid-single-digit rate in FY26, while its core margin should remain relatively stable.

Used-car market weighs on lease-end income

FleetPartners sold 1,618 vehicles during the quarter, a 31% reduction from the previous quarter. End-of-lease income came in at $8 million, while profit per unit fell to $4,951.

The company chose to hold back vehicles rather than accept weaker prices in a softer used-car market. Inventory increased by 448 units during the quarter as a result.

FleetPartners expects sales volumes and lease-end income to improve in the fourth quarter as the winter slowdown eases. However, lease-end income is still expected to remain below the levels recorded in the first two quarters.

Why are FleetPartners shares rising?

The upgrade to FY26 new business written is helping drive today’s gain.

FleetPartners is also growing its funded asset base and core income, while its pipeline remains well ahead of the first-half average.

The used-car market is still weighing on lease-end income, although management avoided selling more vehicles into weaker pricing.

The final quarter will show whether better disposal volumes can lift lease-end income as management expects.

The post Why this ASX financial stock is moving higher today appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

WAM Active Ltd (ASX: WAA) has had a stellar year and is rewarding its shareholders with a special dividend, pushing its total shareholder return for the year past 40%.

Fund outperforms its benchmarks by a healthy margin

The fund said in a statement to the ASX that its investment portfolio increased by a record 75.5% in the year to the end of June, outperforming the Bloomberg AusBond Bank Bill Index (Cash) and the S&P/ASX All Ordinaries Accumulation Index by 71.6% and 69.8%, respectively.

Chairman Geoff Wilson said regarding the result:

FY2026 is the strongest year in WAM Active’s history since the Company was established in January 2008. This record result reflects the strength of WAM Active’s disciplined and flexible investment strategy, outstanding stock selection and active portfolio management. We remained focused on delivering strong long term returns and a growing stream of fully franked dividends for shareholders.

The WAM board has declared a fully-franked final dividend of 3.2 cents per share and a special dividend of 2 cents per share.

The fund added:

Including the special fully franked dividend of 1.0 cents per share announced in January 2026, shareholders will receive total fully franked dividends for FY2026 of 9.4 cents per share. The investment portfolio performance, together with the fully franked dividends paid during the year, delivered a record total shareholder return of 40.2% for the year to 30 June 2026.

WAM said the total dividends for FY26 represented a fully-franked dividend yield of 8.6% and a grossed-up dividend yield of 12.3%.

Fund leans into key themes

The fund’s lead portfolio manager, Oscar Oberg, said the fund’s outperformance was driven by exposure to four key themes: critical minerals, electrification and grid infrastructure, precious metals, and artificial intelligence (AI).

He added:

Equity markets over the 2026 financial year were characterised by elevated volatility, rapid shifts in macroeconomic expectations and pronounced rotation across sectors and themes. Changes to interest rate outlooks, geopolitical developments and the accelerating AI adoption contributed to periods where company fundamentals were often overshadowed by broader market positioning. These conditions created dislocations across parts of the market, particularly in smaller and less well-covered companies, providing opportunities for the investment team to identify mispriced securities using WAM Active’s market-driven approach.

Dividends are still on the table

The ex-dividend dates for the fund’s ordinary dividend and special dividend are 17 November and 4 December, respectively.

WAM shares are changing hands for $1.12, up 36.2% over a 12-month period.

The post This fund’s 75% return smashed its benchmark, and it’s celebrating with a special dividend appeared first on The Motley Fool Australia.

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• Leading fund manager reveals 2 exciting ASX shares to buy

Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

Fortescue Ltd (ASX: FMG) has been in the news for all the wrong reasons recently, with a class action launched against the company and a $150 million judgment against it for cultural damage at sites in Western Australia’s Pilbara region.

Fortescue’s mining operations ticking along

On the operational front, however, the company is delivering solid results and is also looking to invest US$680 million in new green energy infrastructure to support its mining operations, as well as potentially data centres.

Macquarie has recently run the ruler over the company and has reaffirmed its outperform rating on the company’s shares with a positive share price target, which we’ll get to shortly.

Firstly, let’s have a closer look at the company’s most recent production report.

The company in April said it had shipped 48.4 million tonnes of iron ore in the third quarter, bringing the total amount shipped over nine months to 148.7 million tonnes, up 4% over the same period the previous year.

Fortescue Metals and Operations Chief Executive Officer Dino Otranto said at the time:

We delivered a solid quarter, contributing to record shipments of 148.7 million tonnes for the nine months to March. That reflects a significant effort from the team right across the business. At the same time, we’re getting on with decarbonising our operations and we’re already seeing the benefits. Given volatility in global energy markets, there’s never been a clearer reason why this matters. For us, it’s about strengthening energy security, lowering costs and eliminating emissions. The build-out of our green grid is well underway, with 630MW of solar and 133MW of wind generation under construction. As we bring this online, we’re fundamentally reshaping how we power our operations by cutting our reliance on fossil fuels, at a time when energy supply is increasingly uncertain.    

Meanwhile, the class action brought against the company relates to allegations including sexual harassment and sex discrimination.

Fortescue shares still looking like good value

Macquarie said it was expecting Fortescue to ship 53 million tonnes in the fourth quarter, and is also expecting the company to release an optimisation study in the next few months.

Macquarie said:

We expect an in line result at the quarterly, with FY27 guidance the key item of focus; we could see the first signs of the Hematite over magnetite strategy come through in volume guidance, with the outcomes of the portfolio optimisation study potentially occurring later in the year.

Macquarie has a 12-month price target of $21 on Fortescue shares, compared to $18.47 currently.

Including the company’s 6.5% dividend yield, this would equate to a total shareholder return of 17%.

Morgan Stanley has a dissenting view on Fortescue shares, with a sell rating and a price target of $17.25 on the company.

The post How high does Macquarie think Fortescue shares will go? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England 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 Macquarie Group. The Motley Fool Australia has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It has been a rough few months for Dateline Resources Ltd (ASX: DTR) shareholders.

But the ASX mining stock is surging on Monday after receiving some welcome support from the US Government.

At the time of writing, the Dateline Resources share price is up 33.33% to 18 cents.

Despite today’s huge gain, the stock remains down around 20% in 2026. However, Dateline shares are now up roughly 98% since this time last year.

Let’s take a closer look at the latest announcement.

US Government backs Dateline’s position

The support comes from the US Department of Justice (DOJ), which has filed documents opposing a legal challenge surrounding Colosseum.

The Colosseum project is Dateline’s 100%-owned gold and rare earths project in California, which includes a historic open-pit mine.

The case was brought by the National Parks Conservation Association, which is challenging an April 2025 letter recognising Dateline’s existing rights at the project.

According to Dateline, the DOJ believes the current mine plan remains valid and still allows work to take place at Colosseum.

The DOJ also argues the National Park Service letter didn’t grant a new approval. Instead, it says the letter just confirmed the legal position of the existing mine plan.

Dateline said the filing supports the position it has taken throughout the case.

What is the legal dispute about?

The National Parks Conservation Association wants the court to overturn the National Park Service’s April 2025 decision without recognising the company’s mining rights.

However, the DOJ believes the group is unlikely to succeed because the letter did not amount to a final government decision that could be challenged in court.

The department also says laws introduced in 1994 protected the project’s existing rights, including its approved mine plan. A long break in mining doesn’t automatically cancel those rights.

The US Government has also pushed back against claims of immediate environmental damage.

It noted the area has already been disturbed by previous mining, while access to the nearby Clark Mountains remains available by another route.

The DOJ also said concerns about future noise, dust and vegetation removal relate to work that may not even happen.

Foolish takeaway

The DOJ filing is welcome news for Dateline and gives the company more support in the legal dispute over Colosseum.

It backs Dateline’s view that the existing mine plan remains valid and no new federal approval is required. However, the court still has the final say.

Colosseum is a major part of the company’s future. Its bankable feasibility study (BFS) outlined a 10.4-year mine and estimated a pre-tax value of US$785 million.

The study also produced an internal rate of return (IRR) of 49.5%, which is a measure of the project’s expected profitability.

Building the mine is expected to cost US$249 million, plus a US$25 million contingency.

The post Why this ASX mining stock is rocketing 33% after a US Government boost appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

Shares in Elon Musk’s Space Exploration Technologies Corp (NASDAQ: SPCX), more commonly known as SpaceX, again fell below the company’s $150 opening price over the weekend as opinions diverge on where the stock will end up.

SpaceX shares still in the black

The historically large SpaceX initial public offering priced the company’s shares at US$135 apiece, so those who got in before the company listed are still sitting on gains and would have made a tidy profit if they sold out at the US$225.64 high achieved shortly after listing.

The shares have generally drifted lower since that peak was reached, however, and closed Friday’s session at US$145.30, not far off their lowest mark of US$145.07.

This means that almost everyone who bought on-market would be under water on their investment currently.

The stock was included in the NASDAQ 100 index on Tuesday last week, however this failed to significantly bolster the stock.  

So where to from here for SpaceX shares? The Tradingview website has collated the views of 29 analysts with price predictions on SpaceX shares, with the average share price forecast coming out at US$242.21.

However this is distorted by one analyst prediction of a price of US$800 per share on SpaceX shares.

Perhaps more useful is the fact that 24 analysts have rated the stock a strong buy, three a buy, while one rates it a sell and one a strong sell.

Motley Fool US contributor Manali Pradhan has crunched the numbers on SpaceX’s 2027 revenue range and forward sales multiple to come up with an implied market capitalisation, and says US$220 per share is a reasonable base case estimate.

As she wrote:

Analysts expect SpaceX’s 2027 revenue to range from $54.8 billion to $85 billion, with an average estimate of $72.4 billion. Applying a forward sales multiple of 38.5 to 41 times to the 2027 base case revenue estimate yields an implied market capitalization of about $2.79 trillion to $2.97 trillion. Using roughly 13.1 billion shares outstanding, that points to a share price in the range of $213 to $227 at the end of 2026.

Long-term vision on SpaceX shares needed

The difficulty in valuing SpaceX stems from the fact that of its three divisions, only one – the Starlink “connectivity” division is profitable.

The rocket launch and AI divisions are still burning money, with investors needing to buy into the promise that they will in time turn a profit.

The company’s initial public offer prospectus stated that for the first three months of 2026, the Space division lost US$662 million, the AI division lost US$2.47 billion, and the connectivity division made a profit of US$1.19 billion.  

The company believes its business opportunity is huge however, saying in the prospectus, “We believe that space represents the largest economic frontier in human history”, and suggesting that they will be building AI infrastructure in space, powered by the “virtually limitless” power of the sun, for the benefit of mankind.

The post SpaceX shares continue to fall. Where will they end up? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

The ASX share WAM Microcap Ltd (ASX: WMI) is one of the few stocks with a dividend yield of more than 10% that I’d be willing to own for the long-term.

I love passive income, but the higher the yield the less likely it is to be sustainable because the business is paying out such a large part of its profit each year.

However, WAM Microcap is a bit different to a regular business that sells products or services because it’s a listed investment company (LIC). In other words, it buys and sells shares to make money for shareholders.

It’s not looking within the S&P/ASX 200 Index (ASX: XJO) for opportunities though. It’s searching for the most exciting undervalued growth opportunities in the Australian microcap market.

Let’s explore why it’s such a compelling choice for dividends.

LICs need to produce returns

For a LIC to pay sustainable, large dividends, they need to generate good investment returns.

If a LIC’s portfolio generates a double-digit net return over a financial year, then it has essentially done enough to pay a 10% grossed-up dividend yield (including the franking credits).

LICs are not just passive index funds. They can invest very differently to an index, both in terms of the shares they buy and the prices they buy and sell at.

WAM Microcap’s hunting ground represents an area of the market that few fund managers look. There can be some excellent opportunities at the small end of the market because they can be mispriced for their potential and the business can deliver a lot of profit growth from a small base.

The ASX share’s portfolio has delivered an average return per year of 14.4% since inception in June 2017, before fees, expenses and taxes. That’s despite this decade being a tricky period for small-cap shares.  

I believe WAM Microcap’s investment team have the ability to continue making good returns to fund future dividends.

Large dividend yield

WAM Microcap’s board of directors has provided guidance that the business plans to pay an annual dividend per share of 10.7 cents for FY26. That translates into a grossed-up[ dividend yield of around 10.5%, including franking credits.

It has increased its annual dividend per share each year since FY18 (when it started paying dividends), aside from FY24 when it maintained the payout. That’s a strong record of consistency for investors.

The business has a profit reserve of 49.8 cents per share of profit which it built in previous years. That means it could pay the same dividend level for four and a half years without needing to earn any investment returns.

I think Aussies are missing out if they don’t have exposure to small-cap shares for both the diversification and potential returns. WAM Microcap can provide that exposure, along with a great dividend yield level.

There are also other ASX shares that could make great investments today to own for the long-term.

The post This 10% dividend yield stock is one I’m comfortable holding for the long-term appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Wam Microcap. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

DroneShield Ltd (ASX: DRO) has been one of the most talked-about defence technology shares on the ASX in the 2020s.

That attention is understandable. The company sits in a market shaped by drones, electronic warfare, national security, and the growing need to protect military and civilian assets from aerial threats.

And after a major share price decline, investors face a difficult question. Are DroneShield shares a buy, hold, or sell?

DroneShield shares have fallen hard

DroneShield shares are trading around $2.29 at the time of writing.

That leaves the stock down about 65% from its 52-week high.

A fall of that size can make investors nervous, especially in a growth share where expectations have been high. It also changes the valuation discussion.

According to CommSec consensus estimates, DroneShield is forecast to generate earnings per share of 2.6 cents in FY26, 4.3 cents in FY27, and 7.4 cents in FY28.

Based on the current share price, that puts the stock on a price-to-earnings (P/E) ratio of around 88 times FY26 earnings, 53 times FY27 earnings, and 31 times FY28 earnings.

The near-term multiples are still high despite the share price decline.

But the FY28 valuation does not look excessive to me if DroneShield can keep scaling and become a larger, more profitable defence technology business.

Why I would buy

I think DroneShield shares are a buy for investors with a high tolerance for risk.

The reason is the market opportunity.

Drones have changed the way governments, defence forces, airports, prisons, critical infrastructure operators, and security agencies think about protection.

They can be used for surveillance, disruption, smuggling, attacks, and battlefield operations. That creates demand for systems that can detect, track, identify, and respond to drone threats quickly.

DroneShield is trying to become a trusted provider in that market.

I also like that the business is not only about hardware. Increasing software revenue could improve the quality of the revenue base over time, especially if customers keep paying for upgrades, subscriptions, support, data, and system improvements.

That could make the business more valuable than a simple equipment supplier.

What investors need to watch

DroneShield still has plenty to prove. The company needs to keep winning contracts, delivering products, expanding capacity, and turning demand into profits. Defence customers can take time to make decisions, and contract timing can create uneven revenue.

Competition is another risk. Counter-drone technology is attracting attention globally, and larger defence companies may push harder into the market.

There is also valuation risk to consider. Even after a 65% fall, DroneShield is still priced for significant growth. If earnings disappoint, the share price could fall further.

That is why position sizing is important. I would view DroneShield as a speculative growth share rather than a core blue-chip holding.

Foolish Takeaway

I would call DroneShield shares a buy, but only for investors who can handle volatility.

The share price fall has made the valuation more reasonable, particularly if the company can deliver the growth currently expected over the next few years.

The counter-drone market appears to have a long runway, and DroneShield has a strong position in a field that is becoming more important to defence and security customers.

There will be bumps along the way. Contract timing, execution, competition, and valuation all need watching. Still, for patient investors willing to accept the risks, I think DroneShield shares are worth buying after this heavy fall.

The post Down 65%: Are DroneShield shares a buy, hold, or sell? appeared first on The Motley Fool Australia.

More reading

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• These are the 10 most shorted ASX shares

Motley Fool contributor Grace Alvino has positions in DroneShield. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield. 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.