Spare a thought for shareholders in Electro Optic Systems (ASX:EOS) who may have missed news of the overnight Gaza-Israel peace deal. The defence darling’s stock price was down just south of -10% at 2pm AEDT (per CBOE live pricing) as investors bail out and, presumably, swing into critical minerals.
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At the start of the month, prices were above $10/sh, which reflected for many a frothy top even before this peace deal (which seemed to get moving just days before the Nobel Peace Prize was announced; make of that what you will.)
That may have been because while EOS has had some big contract wins this year, including the delivery of a next-gen anti-drone laser to a NATO country, the company’s $1.3B market cap still outpaces contract revenues.
Worth noting, this disparity for EOS pales in size compared to DRO, which is also down on Tuesday on the back of the same wind-back of defence thematic momentum driven by headlines about peace in the Middle East.
For that reason, shorts on DRO are far, far higher – shorts on EOS sit at less than 1% of shares on issue, whereas shorts on Droneshield sit above 5% (though, far off the 10% of shares shorters covered last year right before DRO’s widely-hated 2024 crash.)
That may or may not indicate further pain for DRO, which it’s also worth pointing out has been pretty correlated with EOS in recent history, especially when looking at a share price decline on Tuesday, October 14.
Still, at just north of $7/sh, EOS’s YTD returns are still up +445%.
EOS last traded at $7.06/sh.
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