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DroneShield Limited
(Sydney:DRO)
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Rating:58Neutral
Price Target:
AU$1.50
▼(-23.08% Downside)
Action:Reiterated
Date:08/27/26
The score is primarily supported by improved financial performance and a strong, low-leverage balance sheet, including the 2025 step-change in revenue and return to net profitability. This is meaningfully offset by weak technicals (price below all key moving averages with negative momentum) and an unsupportive valuation signal (negative P/E and no dividend yield provided).
Positive Factors
Revenue and Profitability Inflection
The sharp 2025 increase in revenue and return to net profitability indicate stronger customer demand and greater operating scale. If the expanded business base is sustained, it can support reinvestment, improve earnings resilience, and strengthen DroneShield’s position in counter-UAS markets.
Negative Factors
Margin Compression and Weak EBIT
Although revenue expanded, materially lower gross margins and negative EBIT show that growth has not yet translated into consistently strong core profitability. Continued mix, pricing, cost, overhead, or non-cash pressure could limit earnings quality and reduce the benefit of higher sales.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and Profitability Inflection
The sharp 2025 increase in revenue and return to net profitability indicate stronger customer demand and greater operating scale. If the expanded business base is sustained, it can support reinvestment, improve earnings resilience, and strengthen DroneShield’s position in counter-UAS markets.
Read all positive factors
DroneShield Limited (DRO) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$1.38B
Dividend YieldN/A
Average Volume (3M)8.43M
Price to Earnings (P/E)―
Beta (1Y)2.32
Revenue Growth153.40%
EPS Growth-513.58%
CountryAU
Employees535
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)-0.03
Shares Outstanding925,539,730
10 Day Avg. Volume7,059,236
30 Day Avg. Volume8,433,486
Financial Highlights & Ratios
PEG Ratio-2.97
Price to Book (P/B)8.43
Price to Sales (P/S)13.11
P/FCF Ratio307.22
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$1.96Price Target Upside0.64% Upside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)-0.03
Revenue Forecast (FY)AU$264.10M
DroneShield Limited Business Overview & Revenue Model
Company Description
DroneShield Limited engages in the development, commercialization, and sale of counter-drone hardware and software technology in Australia, the United States, Europe, Asia, the United Kingdon, and internationally. It provides DroneSentry-C2, a com...
How the Company Makes Money
DroneShield makes money primarily by selling counter‑UAS products and integrated solutions to customers such as defense forces, government agencies, law enforcement, and operators of critical infrastructure. Key revenue streams include: (1) Produc...
DroneShield Limited Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Feb 23, 2027
Earnings Call Sentiment Positive
The call presented multiple strong operational and financial positives: substantial YoY revenue/cash receipt growth (~4x), accelerated SaaS revenue (from ~$3M to ~$12M with >$18M locked for 2026), a large $2.1B pipeline, high gross margins (~65%), significant R&D investment ($70M+), operational reliability and manufacturing scale plans. Offsetting risks are a trimmed near‑term pipeline driven by conservative assumptions in the U.S. civilian market (pipeline down ~12.5%), timing dependency on U.S. budget/IDIQ processes, pending profit detail, executive stock sales that attracted scrutiny, and continued high fixed investments. Overall, the highlights materially outweigh the lowlights given the magnitude of revenue and backlog growth, balance‑sheet strength and clear product differentiation, supporting a positive outlook.Positive Updates
Substantial Revenue and Cash Receipts Growth
Reported about $202 million in customer cash receipts and described top-line results as roughly just under 4x the prior year (approximately a multi‑hundred percent YoY increase). The company also began the year with roughly $100 million of carry‑over locked revenue versus $5–10 million this time last year, indicating a large improvement in forward‑looking secured revenues.
Negative Updates
Pipeline Trimmed (US Civilian Conservative Re‑assessment)
Pipeline fell from roughly $2.4 billion three months ago to $2.1 billion (~$300M reduction, ≈12.5% decline) after management applied more conservative assumptions to U.S. civilian (non‑military, non‑law‑enforcement) opportunities due to nascent adoption and slower follow‑on projects.
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Q4-2025 Updates
Positive
Negative
Substantial Revenue and Cash Receipts Growth
Reported about $202 million in customer cash receipts and described top-line results as roughly just under 4x the prior year (approximately a multi‑hundred percent YoY increase). The company also began the year with roughly $100 million of carry‑over locked revenue versus $5–10 million this time last year, indicating a large improvement in forward‑looking secured revenues.
Read all positive updates
Company Guidance
Management did not give formal FY26 revenue guidance but said it expects a “very meaningful” multi‑fold increase over FY25, noting the business entered 2026 with roughly $100M of contracted/locked cash receipts, reported about $202M of customer cash receipts in the latest period (≈4x year‑earlier), and started the year with a healthy cash balance (~$200M). Key metrics highlighted: a $2.1B pipeline (down from ~$2.4B three months prior) across ~300 deals; SaaS growth from just under $3M in 2024 to just under $12M in 2025 and >$18M already locked for 2026 with a target to grow software from ~5% to ~30% of revenue; R&D spend >$70M; ~350 hardware/software engineers (company headcount ~500, planned ~600 by end‑26); target gross margin ~65%; run‑rate cash costs ~$150M; and manufacturing capacity expansion (aiming to support ~$2.4B of output by year‑end) with rapid delivery capability demonstrated on $62M and other orders.DroneShield Limited Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
85
Very Positive
Cash Flow
60
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 269.99M | 216.55M | 57.53M | 54.09M | 16.81M | 10.47M |
| Gross Profit | 70.35M | 108.33M | 41.24M | 38.95M | 11.83M | 7.62M |
| EBITDA | -22.21M | 6.54M | -2.71M | 2.56M | -1.94M | -5.88M |
| Net Income | -30.83M | 3.52M | -1.32M | 9.33M | -949.30K | -5.31M |
Balance Sheet | ||||||
| Total Assets | 425.76M | 412.19M | 355.88M | 97.05M | 25.21M | 18.34M |
| Cash, Cash Equivalents and Short-Term Investments | 178.48M | 209.49M | 219.49M | 56.77M | 10.22M | 9.49M |
| Total Debt | 16.65M | 14.26M | 9.11M | 2.63M | 596.10K | 248.37K |
| Total Liabilities | 117.65M | 75.57M | 44.29M | 22.54M | 6.21M | 2.76M |
| Stockholders Equity | 308.12M | 336.62M | 311.59M | 74.51M | 19.00M | 15.58M |
Cash Flow | ||||||
| Free Cash Flow | 4.96M | 9.24M | -64.40M | 7.75M | -2.58M | -6.74M |
| Operating Cash Flow | 22.10M | 24.07M | -58.04M | 9.48M | -1.75M | -6.27M |
| Investing Cash Flow | -35.62M | 20.21M | -165.26M | -1.95M | -832.17K | -467.45K |
| Financing Cash Flow | -2.15M | -477.00K | 231.89M | 39.11M | 3.06M | -122.03K |
DroneShield Limited Technical Analysis
Negative
1.95
Price Trends
1.70
Negative
2.04
Negative
2.84
Negative
Market Momentum
-0.06
Positive
42.05
Neutral
33.17
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:DRO, the sentiment is Negative. The current price of 1.95 is above the 20-day moving average (MA) of 1.61, above the 50-day MA of 1.70, and below the 200-day MA of 2.84, indicating a bearish trend. The MACD of -0.06 indicates Positive momentum. The RSI at 42.05 is Neutral, neither overbought nor oversold. The STOCH value of 33.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:DRO.
DroneShield Limited Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | AU$2.06B | -28.22 | -19.02% | ― | 224.58% | -281.32% | |
58 Neutral | AU$1.38B | -44.78 | -9.56% | ― | 153.40% | -513.58% | |
45 Neutral | AU$5.92M | -46.67 | -12.70% | ― | 81.90% | -220.00% | |
42 Neutral | AU$32.14M | -5.27 | -66.74% | ― | 31.91% | ― | |
42 Neutral | AU$3.33M | -4.74 | -55.03% | ― | -9.66% | 7.69% |
* Industrials Sector Average
AU:DRO
DroneShield Limited
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DroneShield Limited Corporate Events
DroneShield Seeks ASX Quotation for Additional 200,000 Shares
Oct 13, 2026
DroneShield Limited has lodged an application with the ASX for quotation of 200,000 ordinary fully paid shares under its existing DRO ticker. The securities are scheduled to be quoted from 13 October 2026, reflecting an updated count of listed sha...
Citi Entities Reshape Holdings, Cease to Be Substantial Shareholders in DroneShield
Oct 8, 2026
Citigroup Global Markets Australia and related Citi entities have notified DroneShield Limited that they have ceased to be substantial shareholders in the company as of 6 October 2026, in line with Australian disclosure requirements. The change re...
DroneShield strengthens governance with new Joint Company Secretary
Oct 5, 2026
DroneShield Limited has appointed Candice Driver as Joint Company Secretary, effective 6 October 2026, replacing Carla Balanco and taking responsibility for communications with the ASX under Listing Rule 12.6. Driver brings more than 15 years of l...
DroneShield Secures Spot on US$500m US Counter-Drone Contract Vehicle
Sep 29, 2026
DroneShield’s U.S. subsidiary, DroneShield LLC, has secured a place on the Joint Interagency Task Force 401 Domestic Shield Indefinite Delivery, Indefinite Quantity contract, a three-year procurement vehicle with a ceiling of US$500 million....
DroneShield lifts committed revenue to $251m and appoints new CFO
Sep 10, 2026
DroneShield has appointed seasoned technology-sector finance executive Rebecca Lowde as Chief Financial Officer, succeeding long-serving CFO Carla Balanco as the company enters a new phase of global scaling. Lowde brings extensive public-company a...
DroneShield Seeks ASX Quotation for Additional Ordinary Shares
Aug 27, 2026
DroneShield Limited has applied for quotation of 1,128,946 ordinary fully paid shares on the ASX, to be traded under the ticker DRO. The securities are being listed following the exercise or conversion of existing options or other convertible inst...
DroneShield issues 1H 2026 interim results presentation with extensive investment disclaimers
Aug 26, 2026
DroneShield Limited has released its 1H 2026 interim results presentation, outlining current information on the company and its associated entities as of 26 August 2026. The document emphasises that the material is for information purposes only an...
DroneShield posts record revenue but swings to loss as it scales for next-gen counter-drone growth
Aug 26, 2026
DroneShield reported record first-half 2026 revenue of $125.8 million, up 74% year-on-year, and a sharp rise in recurring revenue to $11.5 million as its installed base reached 4,100 software-enabled devices. Despite this top-line growth, the comp...
DroneShield Delivers Strong Revenue Growth but Falls to Half-Year Loss
Aug 26, 2026
DroneShield Limited reported a sharp 74% rise in half-year revenues to $125.8 million for the period ended 30 June 2026 but swung from a prior-year profit to a net loss of $32.2 million.Net tangible assets per share declined from $0.33 to $0.28 an...
DroneShield launches flagship RfRecon RF intelligence system to bolster counter-drone capabilities
Aug 9, 2026
DroneShield has launched RfRecon, a portable radio frequency intelligence solution positioned as its flagship next-generation counter-drone product. Built on the company’s proprietary RfAI-3 architecture, the system combines ultra-wideband s...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.