DroneShield Share Price Down on More Government Contracts (ASX:DRO)

What makes the DroneShield Ltd [ASX:DRO] share price tick?

The Sydney-based aerospace company recently announced several new contracts with international governments.

With drone usage increasing in the militaries around the world, DRO’s product is growing in popularity to combat that threat. Trading at 19 cents at time of writing, the DRO share price looks to be stabilising after falling since the end of 2019.

ASX DRO Share Price Chart 1

Source: Optuma

What’s happening at DroneShield?

Over the last two weeks the company announced a flurry of new orders.

Coming in from all parts of the globe too. Two European nations, a major Southeast Asian nation that is allied with the West, and the company also received funding from the United States Department of Defense (DoD) for development of its DroneShield Complete Comand-and-Control system.

ASX DRO Droneshield Products

Source: droneshield.com

The invention of drones over recent years opened a whole new world of capabilities for both state actors and terrorists or criminals.

With drones being able to carry cameras, communication devices and much more harmful payloads.

This created a defence industry with clients ranging from international militaries to prisons all looking to contain this threat.

DroneShield provides the solution with a wide range of products for a variety of applications.

As evident by the recent announcements, these solutions are becoming serious tools for international militaries looking to protect their people and assets.

On the back of the recent announcements, Oleg Vornik, DroneShield’s CEO mentioned, ‘Our world-leading product offering meets the requirements of some of the most demanding military and Government users globally. Combined with our on-the-ground representation in over 100 countries globally, we are now starting to see our extensive pipeline converting into end user orders.

Where to from here for the DRO share price?

The secretive nature of militaries naturally inhibits sales or projects being announced and the details of them are pretty thin.

At time of writing DroneShield looks to be trading around a natural level of 19 cents.

ASX DRO - Droneshield Share Price Chart 2

Source: Optuma

If the DRO share price were to continue to decline then the level of 13 cents may become the focus, conversely should it turn to the upside then the level of 25 cents may provide future resistance, which was the most recent high price.

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Carl Wittkopp

For Money Morning

Carl Wittkopp writes for Money Morning and has a diploma in Financial Planning. He specialises in technical analysis.

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