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Aussie defence tech developer DroneShield (ASX:DRO) is in an interesting time in its life. It’s well and truly outperformed by Electro Optic Systems (ASX:EOS) at this point, with the latter also getting into C-UAS tech; at the same time, fibre optic drone usage limits the overall value prop of DRO’s tech.
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At the same time, DroneShield investors remain keenly aware the company’s CEO sold all his shares last year out of the blue. That went about as well as you’d expect.
Further, we’ve got a new war to sink our teeth into – the USA’s attack on Iran, which has threatened a new wave of COVID-level inflation – and yet, Droneshield hasn’t really shot up relative to where it was before the war started.
In fact, while the $3.6 billion market cap company is up as much as +370% YoY, it’s down nearly -3.5% over the last month, where the meat of the U.S.-Iran war has really come forth in global headlines. True, the company has little exposure to the Middle East, where Electro Optic has contracts across MENA.
To be fair, around a year ago, the DRO price was ~$1/sh. At time of writing, it’s just south of $4/sh – so that’s evidence of investor conviction in the overall value prop, and this finance journalist has too ridden the waves of DRO volatility.
It’s a darling for that reason, but on Tuesday, investors will no doubt have further considerations to weigh. That’s because the world’s largest (investment) bank, JP Morgan, has ceased to be a substantial shareholder.
That JPM has done this in the middle of a war is perhaps the loudest ‘sell signal’ that may become obvious to some investors.
And, even as this new global conflict gets louder and louder, DroneShield has also surpassed its previous record high short interest of 10.3% in 2025 to see 11.4% of shares shorted as of late March.
Where DroneShield goes from here is unclear, but it’s another blow to sentiment for long-term holders, and Tuesday’s price action is likely to reflect a show of caution from the zeitgeist. Y’know, probably.
DRO last traded at $3.95sh before Tuesday.
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