What's got the Droneshield share price moving higher?
In its FY24 report, Droneshield revealed another record year of revenue. However, there was only a minor increase from $54.1 million in 2023 to $57.5 million in 2024.
The more exciting news for investors was that the company revealed it already had $51 million worth of revenue secured just two months into the new year.
Droneshield said it had already recorded $18 million in revenue for 2025 and a further $33 million in committed contracts underway.
Foster Stockbroking reckons Droneshield is "on track to double revenue in FY25".
In anotepublished on Listcorp this month, Foster Stockbroking said it also expects a return to positiveearnings before interest, taxes, depreciation, and amortisation (EBITDA)this year.
Foster said:
We hosted a session with Droneshield Limited (ASX
RO) MD Oleg Vornik last week and came away feeling upbeat on the company's outlook.
We believe DRO will double its revenue this year, exceeding $100M and returning to positive EBITDA.
Foster is impressed with Droneshield's growing pipeline of work and strong balance sheet.
The broker noted that Droneshield had a cash balance of $215.2 million as of 18 February.
This is enough to fund at least two years of growth, product enhancements, and new staff.
Foster said:
[Droneshield has a] Robust well-diversified $1.2B sales pipeline offers visibility through 2026, with Asia (ex-China) leading at $543M, up from under $20M last year, followed by Europe at $382M (up from $106M) and the US ($122M).
Growth is driven by: (1) Asia's ramp up against Chinese drone threats, (2) Europe's rising demand, (3) larger Australian DoD contracts expected with renewal in mid-2025, and (4) expanding Mexico and Middle East presence.
In its FY24 report, Droneshield said it had invested heavily last year to scale up the business.
The company conducted a $235 millioncapital raiselast year to help fulfil this goal.
In Sydney, Droneshield expanded its manufacturing facility to enable a capacity of up to $500 million worth of products per annum.
The majority of the new space has been dedicated to the DroneSentry-X Mk2TM product.
Droneshield said it expects this product to drive significant revenue in FY25 and beyond.
What's the outlook?
Droneshield is now operating in 70 countries and looks well-positioned to capitalise on the increasing demand for drones and drone defence systems.
Independent Non-Executive Chairman Peter Jamessaid:
Nefarious use of drones is a global and rapidly rising threat, with DroneShield providing a proven market leading suite of solutions, directly and via its network of in-country partners in 70 countries globally.
Foster Stockbroking predicts that Droneshield will be a "prime beneficiary of the global defense supercycle surge".
And it's not the only broker that is positive on the stock.
Bell Potter is alsobackingthe Droneshield share price for growth. The broker has a buy rating on Droneshield with a 12-month share price target of $1.10.
Droneshield was also upgraded to aconsensus 'strong buy' ratingby analysts on CommSec last month.
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