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Electro Optic Systems (ASX:EOS) has seen its shares surge more than +18% out the gate on Monday in the first twenty minutes of trade as the US-Iran war sees investors reallocate into fairly obvious domains.
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Those domains? Defence stocks, oil stocks, gold, and bonds. Helpfully for Electro, it had a sensitive announcement to release on the first trading day after the war – which didn’t come as a surprise – outlining the company’s ongoing opportunity pipeline.
Helping matters, the company wants to send counter-drone tech to the UAE, for one, which we’ve just seen hit with Iranian missiles over the weekend as that country targeted US bases within the country. EOS further wants to manufacture weapons system in the UAE itself, with a partnership to be the subject of ongoing strategy through 2026.
At the same time, an A$17M order has been flagged by the company for an R400 remote weapon system (RWS) with 30mm cannons to go to an undisclosed “Middle Eastern GCC country.”
If EOS was looking for a catalyst to shake off concerns borne from the Grizzly Research short sellers’ report, it’s found it. EOS at above $10/sh is close to where it was in October last year when it hit record highs above A$11/sh.
Meanwhile, another RWS will be sent to India for the first time in a deal worth up to A$2M. As for the US-Iran war?:
“EOS expects that the current ongoing military conflict could accelerate [sales] … there is no guarantee that any additional orders will be secured,” EOS wrote on Monday.
The company also confirmed its finalisation of an A$100M loan facility on Monday.
EOS last traded at $10.50/sh.
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