Analyst Optimism Fuels DroneShield’s Share Price Momentum

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A bullish research note from Bell Potter has provided significant upward pressure for DroneShield shares today. The broker has revised its price target and earnings estimates higher, citing several concrete catalysts, particularly within the US security market. This comes alongside company announcements of software updates and references to a substantial sales pipeline. The question for investors is whether this combination will sustain momentum throughout the year.

In its latest analysis, Bell Potter has reaffirmed its buy recommendation for the counter-drone technology firm while lifting its price target from A$4.40 to A$5.00. The broker has also increased its earnings per share (EPS) forecasts for the fiscal years 2025 through 2027 by 4%, 8%, and 3%, respectively.

These adjustments are reportedly based on revised assumptions concerning the diluted share count, a higher tax rate, and accelerated hiring. A key driver, however, is a projected 5% revenue increase for 2026 and 2027, which Bell Potter attributes directly to the recently passed Safer Skies Act in the United States.

The valuation perspective is also highlighted. Based on estimated 2026 EV/EBITDA, analysts note a multiple of 47, which they suggest represents a 34% discount to a global peer group within the drone sector. Furthermore, from a potential sales pipeline valued at A$2.5 billion, the broker anticipates major contract awards within the next three to six months as defense budgets transition into the 2026 fiscal year.

Software Enhancements Announced

Separately, DroneShield recently announced new software releases for several of its key platforms. The updates cover DroneSentry-C2, DroneSentry-C2 Enterprise, and the RfPatrol plugin, accompanied by firmware upgrades for detection and mitigation systems.

The core focus of these updates is enhanced system interoperability and tighter sensor coordination. Key improvements include:
* Expanded support for multi-sensor configurations.
* Refinements in sensor fusion to boost detection accuracy and tracking stability, especially in mobile deployment scenarios.

The RfPatrol plugin has been upgraded to allow detection and tracking data to be shared across TAK networks. For the DroneSentry-C2 platform, the company reports performance gains such as reduced latency, a smoother user interface, and simplified controls.

Near-Term Catalysts and Market Position

Bell Potter identifies US Public Safety initiatives as a central growth driver for 2026. A specific focal point is the FIFA World Cup 2026, to be hosted in North America. The study points to approximately US$250 million in allocated funding for US states hosting World Cup matches and "America 250" events, earmarked specifically for counter-unmanned aerial system (C-UAS) protective measures.

The broker explicitly states it expects "material orders" for DroneShield from this environment and sets correspondingly high expectations for contract wins from the US security sector.

On the domestic front, DroneShield was selected on January 15 for the Australian government's LAND 156 C-sUAS Services Standing Offer Panel. This framework agreement opens the door for the company to provide counter-drone services across approximately 150 military sites. Australia has allocated A$1.3 billion over the next decade for related capabilities, providing a tangible benchmark against which Bell Potter's assessments can be measured in coming quarters.

Trading Activity and Year-to-Date Performance

In today's session, DroneShield equity advanced roughly 7% to A$4.63 by midday, bringing the share price close to its January highs. Since the start of the year through yesterday's close, the stock had already appreciated approximately 30%.

During Wednesday's trading, the shares finished at A$4.32 following a volatile session that saw them move between A$4.21 and A$4.60, with trading volume reaching 18.8 million shares.

Looking Ahead

The company's next quarterly results are scheduled for release on March 3. Bell Potter frames 2026 as an inflection point for the global C-UAS industry, anticipating significantly increased spending by numerous nations on radio frequency (RF)-based detection and mitigation solutions.