Counter-Drones Take Center Stage as Machinery of War Evolves

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The conflict between the United States and Iran that began in February is kick-starting the market for counter-drone technology, giving momentum to companies positioned to take advantage of the tailwinds, experts said.

Since the first shots were fired, Iran has launched more than 5,000 drones, more than 2,100 ballistic missiles, and more than 50 cruise missiles, Jon Gambrell wrote for The Associated Press on April 8 in an article published by PBS.

"Before the war, JINSA (Jewish Institute for National Security of America) estimated Iran's arsenal to be between 8,000 to 10,000 ballistic missiles of various ranges," Gambrell noted. "No public estimate exists of Iran's drone stockpile."

The conflict has accelerated the purchase of counter-unmanned aerial systems (C-UAS), with a US$3.1 billion Pentagon C-UAS budget (expected to grow tremendously in 2027), a newly consolidated US$20 billion Army ordering vehicle awarded to Anduril, and pure-play specialists like DroneShield, Electro Optic Systems, and Red Cat racking up record contracts, counter-drone technology has emerged as the defining defense-tech investment theme of 2026.

The U.S. military is set to continue its deployment of counter-drone capabilities to the Middle East in response to ongoing uncertainties surrounding the conflict with Iran, as confirmed by a Pentagon task force spokesperson, according to Drew F. Lawrence writing for DefenseScoop on April 10.

This follows a substantial investment in counter-unmanned aerial system (C-UAS) technologies, which has been deemed overdue by defense experts, Lawrence noted. Despite the longstanding awareness of drone threats, the U.S. has been slow to invest in necessary countermeasures, which are now crucial due to Iran's use of low-cost drones that have been supplied to various countries, including Russia.

2027 Budget Could Add Significantly to the Pot

The Joint Interagency Task Force 401, an Army-led group, has allocated over US$600 million to bolster U.S. drone defenses both domestically and for Operation Epic Fury, wrote Lawrence. More than half of this funding was directed towards efforts led by the U.S. Central Command in the first month of the conflict. The task force plans to continue enhancing the region's defenses against drones, although specific details about the capabilities deployed or the exact amount of equipment were not disclosed.

Lt. Col. Adam Scher, a spokesperson for the task force, stated, "The US$350 million worth of commitments JIATF-401 has made over the last 30 or so days in support of Operation Epic Fury does include capabilities already in the hands of our warfighters in Centcom as well as capabilities not yet fielded or delivered that will continue to flow into theater over the coming days and weeks."

The Pentagon's fiscal 2027 budget also proposes a significant increase in counter-drone spending as the recent investments were made using fiscal 2026 funds. Lauren C. Williams writing for Defense One on April 8 reported that the Pentagon wants to buy US$994.1 million worth of counter-drone tech in 2027, according to budget documents. 

The proposed budget also reflects a substantial rise in research and development expenditures for C-UAS technologies. Specifically, the Army is requesting US$26.5 million for applied research in this area, which more than doubles the amount set aside in 2026. Additionally, development funding for C-UAS could see a significant increase from US$140 million in 2026 to US$359.2 million in 2027, pending Congressional approval, Williams wrote.

These proposed increases in funding come at a time when the U.S. military is expected to ramp up spending on counter-drone technologies due to the growing threat of drones globally and the military's ongoing efforts to adapt and innovate based on insights gained from the Russia-Ukraine conflict.

The ongoing drone conflict highlights a critical area of vulnerability that has not been adequately addressed by previous U.S. administrations, according to Alex Plitsas, a senior fellow at the Atlantic Council, reported Lawrence for DefenseScoop. Plitsas criticized the delayed response in investing in counter-drone technology, suggesting that the U.S. was "late to the game" and is now scrambling to catch up in developing effective defenses against drone threats.

Race Is on to Meet Demand

The Global C-UAS Market is poised for significant growth, with projections indicating a compound annual growth rate (CAGR) of approximately 21.9% from 2026 to 2032, according to a detailed market analysis by MarkNtel Advisors. This surge in market growth is largely due to the escalating use of drones in military operations, heightened security concerns over unauthorized drone activities, and increased governmental funding in sophisticated counter-drone technologies aimed at protecting vital infrastructure, military installations, and public areas.

North America is expected to lead this market, holding nearly 52% of the global market share throughout the forecast period. This dominance is supported by robust defense expenditures, the swift deployment of cutting-edge counter-drone systems, and the presence of major defense technology firms in the United States and Canada.

In terms of market valuation, the Global C-UAS Market was estimated at approximately US$5.12 billion in 2025 and is anticipated to rise from US$8.5 billion in 2026 to about US$27.98 billion by 2032, the report noted. This growth reflects the increasing threats from drone-related security issues and the rising investments in advanced detection and mitigation technologies worldwide.

Now that the race is on to meet demand, several companies are positioned to possibly find traction, including heavyweights like Anduril and Palantir, as well as pure-play specialists like DroneShield, Electro Optic Systems, Red Cat Holdings, and RTX.

Anduril Industries Inc.

The Army-run counter-drone task force has awarded privately held Anduril's Lattice software an US$87 million contract to serve as the command-and-control backbone of a broader enterprise deal that could potentially reach up to US$20 billion over the next decade, according to a report by Mark Pomerleau for Breaking Defense on March 16. The Lattice software will integrate various sensors and effectors to facilitate rapid detection, tracking, classification, and engagement of unmanned aerial system (UAS) threats, Pomerleau reported.

According to a report by Jobs With DOD on March 14, it is "one of the largest defense technology agreements in recent military procurement history."

Matthew Steckman, Anduril's president and chief business officer, clarified to reporters that the US$20 billion figure represents an "ordering guide" for federal government buyers to purchase Anduril's commercially produced products. He emphasized that this is a contract vehicle without any direct financial attachment but is intended to reduce bureaucratic friction in procurement processes, the Breaking Defense article said.

Brent Ingraham, the assistant secretary of the Army for acquisition, logistics, and technology, highlighted the strategic importance of shifting to enterprise contracts for modernizing the force. He noted that by consolidating numerous disparate contracts, the Army can leverage its purchasing power on an enterprise scale, potentially saving billions in taxpayer dollars and streamlining acquisition processes, Pomerleau reported.

In a similar vein, the Army awarded a US$10 billion deal to tech firm Palantir Technologies in August and has issued 14 enterprise contracts that consolidated 118 separate contracts over the past eight months, resulting in an 88% reduction in the total number of contracts, according to Pomerleau's report. Anduril, which previously had 120 separate contracts with the Army, now offers its commercially available technology to the entire Department of Defense, allowing for quicker adoption of commercial capabilities while maintaining competitive procurement practices. The Army is currently seeking another enterprise contract winner, having reopened its commercial software request for information for the third time, aiming to establish a single Indefinite Delivery, Indefinite Quantity (IDIQ) contract vehicle to address future needs more cost-effectively and efficiently.

"The Army has awarded a mega contract to Anduril Industries that the U.S. military hopes will boost its ability to defeat drone threats," wrote Jon Harper for DefenseScoop on March 14.

Harper continued, "Anduril, which was founded in 2017 by Palmer Luckey, has landed large contract awards in recent years from the Pentagon for a variety of defense technologies, including hardware and software for uncrewed systems and counter-UAS tools. The company's AI-fueled Lattice software platform, which provides a C2 interface, has been a centerpiece of many of those capabilities."

The U.S. military's initiative to enhance command and control capabilities has gained momentum, underscored by a recent visit to Kyiv by members of the Joint Interagency Task Force 401, as reported by DefenseScoop. Army Brig. Gen. Matt Ross, director of the task force, emphasized the necessity of a unified command and control system after observing the impact of drones on modern warfare during his visit to Ukraine. He stated, “Based on our testing and evaluation, it became clear that a common command and control system is needed to effectively counter adversary drones. These results were confirmed during my visit to Ukraine, when I saw firsthand how drones have changed the modern battlefield.”

In light of these developments, officials have praised the US$20 billion deal as a strategic enterprise vehicle designed to streamline the Pentagon's procurement processes for C-UAS tools and to enhance interoperability among various government partners. Army Col. Tony Lindh, JIATF 401 deputy director of acquisitions, highlighted that this initiative would facilitate "common air domain awareness," with Anduril's Lattice platform serving as the central C2 backbone.

Anduril is set to significantly expand its workforce and operational facilities in response to the demands of the contract, the Jobs With DOD piece noted. The company has announced plans to construct Arsenal-1, a new 5-million-square-foot manufacturing facility in Pickaway County, Ohio. This development is expected to generate over 4,000 production and service jobs by 2035, marking it as the largest single job creation and new payroll initiative in the history of Ohio.

In addition to the Ohio manufacturing site, Anduril is also planning to establish a major campus in Long Beach and Lakewood, California. This campus will accommodate approximately 5,500 direct jobs and will feature a 1.18 million-square-foot area, blending 750,000 square feet of office space with 435,000 square feet dedicated to industrial space for research and development purposes. The California facility is anticipated to be operational by mid-2027.

Currently, Anduril employs 7,000 individuals across 35 locations, with about half of these employees based in Southern California, Jobs With DOD reported. The construction and development of the Ohio facility are scheduled to commence following the receipt of state and local approvals, with the manufacturing of the first products targeted to begin in July 2026.

Palantir Technologies Inc.

About seven months before the Anduril deal, the Army entered into a similar agreement with Palantir Technologies Inc. (PLTR:NASDAQ), awarding the tech firm up to US$10 billion over a decade through a new Enterprise Service Agreement, according to Carley Welch reporting for Breaking Defense on August 1, 2025.

This strategic move aimed to simplify and economize the Army's software acquisition process and consolidated 75 existing contracts into a single comprehensive software agreement, as explained by Danielle Moyer, executive director of the Army Contracting Command at Aberdeen-Proving Ground, Welch wrote. Of these contracts, Palantir is the prime contractor on 15 and a subcontractor on 60.

The flexibility of the contract allows the Army to adapt its software purchases based on evolving needs and market conditions, according to Welch. Moyer pointed out that this arrangement offers the Army the ability to opt-out without repercussions if a better deal or competitor emerges, or if the arrangement no longer meets the Army's needs. This approach also increases transparency and ensures that the Army only pays for the software capabilities it actually requires, rather than unnecessary extras included in typical software packages.

At the time of the article in 2025, Moyer said the Army was negotiating 10 to 15 similar agreements, driven by an analysis of repeated purchases of the same commercial software across the service. This initiative is aligned with a Pentagon-wide effort to streamline software acquisition and modernize military networks, reflecting a significant shift towards enhancing innovation and efficiency in military operations.

Miami-headquartered Palantir Technologies Inc. specializes in developing data integration and analytics platforms. Founded in 2003 by Peter Thiel, Stephen Cohen, Joe Lonsdale, Alex Karp, and Nathan Gettings, the company provides sophisticated tools that enable government agencies, militaries, and corporations to merge and analyze data from various sources. Its flagship products include Gotham, which is tailored for intelligence and defense applications, and Foundry, designed for commercial and civil use.

Palantir's software solutions are also widely used in the corporate sector by clients such as Morgan Stanley, Merck KGaA, Airbus, and Fiat Chrysler Automobiles, among others, its Wikipedia entry noted. The Palantir Apollo platform supports continuous integration/continuous delivery (CI/CD) across various environments, enhancing operational efficiency.

Recently, Palantir achieved a significant financial milestone by reporting its first quarter of positive net income under non-GAAP metrics in Q4 2022 and its first quarter of positive GAAP net income in Q1 2023, totaling US$31 million, marking the company's shift to profitability nearly two decades after its establishment.

Palantir's products are among the five offerings authorized by the U.S. Department of Defense for Mission Critical National Security Systems (IL5), underscoring their critical role in national security and enterprise operations.

The company reported impressive fourth-quarter results for 2025, surpassing both management's guidance and analyst estimates, driven by significant growth in its U.S. commercial and government segments, according to an updated research note by Almas Almaganbetov for Freedom Broker on February 13.

The company's Artificial Intelligence Platform (AIP) has been a key factor, successfully converting pilot projects into large-scale contracts, particularly in the U.S., where sales momentum is accelerating. However, international growth remains sluggish due to cultural and structural barriers to AI adoption, particularly in Europe and Canada.

For the quarter, Palantir posted revenue of US$1.41 billion, marking a 70% increase year-over-year and exceeding the high end of management's guidance of US$1.33 billion, as well as surpassing analyst forecasts. The commercial segment alone brought in US$677 million, up 82% year-over-year, with the U.S. commercial business particularly strong, showing a 137% increase in revenue to US$507 million. The U.S. government segment also showed robust growth, with revenue of US$570 million, a 66% increase from the previous year. This segment benefited notably from strategic initiatives like the Ship OS and the Warp Speed initiative, which significantly reduced production planning times in the defense industrial base.

Adjusted diluted earnings per share (EPS) for the quarter came in at US$0.25, up 79% year-over-year, beating both the company's and market expectations. Palantir also reported strong growth in remaining performance obligations (RPO), which reached US$4.2 billion, up 144% year-over-year. Total contract value (TCV) for the quarter reached a record US$4.3 billion, although the growth rate decelerated compared to previous quarters. The company closed 180 contracts valued above US$1 million during the quarter, with 61 of these exceeding $10 million, Almaganbetov wrote.

Given Palantir's strong performance in 2025 and optimistic guidance for 2026, revenue forecasts have been raised for 2026 and 2027, the note said. The company's long-term business model appears robust against potential threats from new AI agents, such as those from Anthropic. Palantir's strategy focuses on monetizing ontology, data integration, and orchestration of complex business processes, rather than just foundational AI models, which are becoming increasingly commoditized.

"Against this backdrop and given the lack of meaningful threat from new AI agents, we maintain our PLTR price target at US$170, valuing the stock at 82x 2027 P/FCF," the Freedom Broker analyst said. "We upgrade our rating from 'Sell' to 'Buy,' as the recent, notable pullback in the share price looks unjustified in the context of continued hypergrowth and the underlying strength of the AIP platform."

According to Rick Munarriz writing for The Motley Fool on April 20, the investment appeal of Palantir Technologies is often centered on its potential for future growth, despite its current high valuation metrics. Trading at 111 times forward earnings and 79 times next year's earnings target, Palantir's stock might seem steeply priced. However, the company has consistently outperformed Wall Street's profit forecasts, leading to a series of "beat and raise" scenarios where analysts continually adjust their expectations upward.

Palantir's business is evolving, initially gaining prominence through its AI-driven automation solutions that supported government counterterrorism and other public sector functions, Munarriz noted. More recently, however, it is Palantir's commercial sector operations that are drawing attention. While still secondary to its public sector business, the commercial side is growing at a faster rate. Palantir's ability to leverage its data analytics capabilities has proven effective in providing businesses with competitive advantages, enhancing its attractiveness in the private sector.

The narrative around Palantir continues to improve with each retelling, particularly as the company has experienced sharp revenue increases in consecutive years, The Motley Fool piece said. For 2026, analysts anticipate a significant acceleration, projecting a 62% growth in revenue. Although no single metric currently positions Palantir as an outright bargain in the market, the company's substantial size coupled with its accelerating business growth and expanding profit margins make it a formidable player. This robust performance trajectory makes Palantir a challenging stock to bet against, especially in a rising market.

According to FactSet, at least 23 other analysts have ratings on the company. The website noted Piper Sandler Companies analyst Clarke Jeffries has a Buy rating with a price target of US$230, DA Davidson analyst Gil Luria has a Hold rating with a price target of US$180, Mizuho Securities USA analyst Gregg Moskowitz has a Buy rating with a price target of US$185, Wedbush Securities analyst Dan Ives has a Buy rating with a price target of US$230, Benchmark analyst Yi Fu Lee has a Hold rating, Jefferies analyst Brent Thill has a Sell rating with a price target of US$70, Rosenblatt Securities analyst John McPeake has a Buy rating with a price target of US$200, Northland Securities analyst Michael Latimore has a Buy rating with a price target of US$190, Truist Securities analyst Arvind Ramnani has a Buy rating with a price target of US$223, Loop Capital Markets analyst Mark Schappel has a Buy rating with a price target of US$220, William Blair analyst Louie DiPalma has a Buy rating, CrispIdea analyst Satish Gaonkar has a Buy rating with a price target of US$172.08, Argus Research analyst Joseph Bonner has a Hold rating, Daiwa Securities Co. Ltd. analyst Shigemichi Yoshizu has a Buy rating with a price target of US$180, Baptista Research analyst Ishan Majumdar has a Buy rating with a price target of US$198, China International Capital analyst Ye Tao has a Hold rating with a price target of US$150, Deutsche Bank Research analyst Brad Zelnick has a Hold rating with a price target of US$200, Raymond James analyst Brian Gesuale has a Hold rating, Cantor Fitzgerald analyst Thomas Blakey has a Hold rating with a price target of US$198, RBC Capital Markets analyst Rishi N. Jaluria has a Sell rating with a price target of US$90, Morningstar Equity Research analyst Mark Giarelli has a Hold rating with a price target of US$150, Equisights analyst Parth Talsania has an Overweight rating with a price target of US$152.11, and Phillip Securities Research Team has a Buy rating with a price target of US$208.

¹About 4% of the company is owned by insiders and management, and about 62% by institutions. The rest is retail.

Top shareholders include The Vanguard Group with 9.36%, BlackRock Institutional Trust Co. with 5.6%, State Street Investment Management with 4.7%, Peter Thiel with 3.09%, and Geode Capital Management LLC with 2.37%.

Its market cap is US$348.77 billion with 2.4 billion shares outstanding. It trades in a 52-week range of US$89.31 and US$207.52.

DroneShield Ltd.

Australian company DroneShield Ltd. (DRO:ASX; DRSHF:OTC) operates both in Australia and the United States and specializes in providing advanced C-UAS solutions that incorporate a range of sophisticated technologies. These include Radio Frequency (RF) sensing, AI, Machine Learning (ML), Sensor Fusion, Electronic Warfare, Rapid Prototyping, and MIL-SPEC manufacturing, according to the company's website.

DroneShield's comprehensive capabilities are designed to offer protection to a diverse set of clients including military units, government bodies, law enforcement agencies, critical infrastructure entities, commercial enterprises, and VIPs globally, the company said.

DRO is known for its dual approach to product offerings. It provides both bespoke solutions tailored to specific customer needs and off-the-shelf solutions that are ready for immediate deployment. These solutions are versatile and can be adapted for use across various platforms, whether terrestrial, maritime, or airborne, the company said.

According to an April 22 updated research note by Bell Potter Analyst Baxter Kirk, the investment thesis for DRO remains strong with a Buy rating and a target price of AU$4.80, unchanged from previous assessments. DRO is recognized for its market-leading RF detect/defeat C-UAS offerings and a competitive edge strengthened by extensive battlefield experience and a dedicated R&D team. The year 2026 is expected to be a pivotal year for the global C-UAS industry, with anticipated substantial spending on RF detect and defeat solutions as defense budgets are updated for FY26, the analyst said. DRO, trading at 43x CY26e EV/EBITDA, is currently valued below the global drone peer group average. Given the burgeoning opportunities in the C-UAS industry, there is potential upside risk to revenue forecasts for 2026 and 2027.

Kirk said DRO reported a significant increase in revenue, reaching AU$74 million, up 121% year-over-year (YoY), surpassing the earlier April 8 trading update projection of AU$63 million. This increase was attributed to the timing of deliveries. The company's quarterly SaaS revenues stood at AU$5.1 million, contributing to AU$11.6 million for the full year 2025, which accounted for 6.9% of the total revenue.

The company's sales pipeline remained stable at AU$2.2 billion as of March 31. As of April 20, the company had received confirmed orders for Committed Revenue of AU$154.8 million for the entirety of 2026, of which AU$74.1 million was recorded as revenue in the quarter ended 31 March 2026. Bell Potter has projected revenue to increase to AU$324.2 million in CY26 and further to AU$495 million by CY28, with corresponding EBITDA expected to rise significantly during this period.

FactSet reports at least one other analyst holds a rating on DRO, Jefferies analyst William Richardson has initiated coverage with a Hold rating and a US$3.70 target price.

¹Fidelity Management and Research holds about 8.84%, State Street Investment Management holds 7.53%, BlackRock Institutional Trust Co. holds 5.5%, J.P. Morgan holds 5.15%, and the Vanguard Group holds about 5.16%.

Management and insiders hold more than 2% and institutions hold 36%. The rest is retail. 

DroneShield has 923.1 million outstanding shares and 866.92 million free-float traded shares. Its market cap is AU$3.52 billion. Its 52-week range is AU$1.16–AU$6.71 per share.

Electro Optic Systems Holdings Ltd.

Electro Optic Systems Holdings Ltd. (EOPSF:OTCMKTS; ESO:ASX), which is also based in Australia, focuses on developing and producing electro-optic technologies primarily for the aerospace sector, according to PitchBook.

The company operates through two main segments: defense and space. The defense segment, which is the primary revenue generator for the company, is involved in the development, manufacturing, and marketing of fire control, surveillance, and weapon systems for approved military customers. On the other hand, the space systems segment offers a variety of ground products designed to support both the Australian and international space markets.

Geographically, the majority of the company's revenue is derived from within Australia.

According to a post on the company's site on April 20, EOS' counter-drone technology was recently showcased during the US Army's Summit Strike live fire exercise, which took place on April 14 and was conducted by the 10th Mountain Division. This exercise was a combined arms event designed to test the planning and integration of emerging technologies in a contested, large-scale combat scenario. It involved multinational forces and industry participants working together to coordinate actions across multiple domains.

During the exercise, EOS demonstrated its Sling Blade Counter Unmanned Aircraft System. This system combines EOS' Slinger counter-drone remote weapon system with a 30 mm cannon, a four-pack APKWS rocket launcher, and an SRC radar, creating a comprehensive closed-loop counter-drone capability. The Sling Blade was part of a two-hour live fire activity that also featured field artillery, Apache attack helicopters, electronic warfare assets, and uncrewed ground vehicles. This demonstration underscored the importance of counter-drone capabilities within a larger integrated system of systems environment.

Over the past year, EOS Defence Systems USA has been under contract with the US Army DEVCOM Armaments Center to further develop the Sling Blade, the company said. This development has included the integration of radar technology to enhance the system's ability to provide firing solutions against drone threats. Looking ahead, further trials involving the 10th Mountain Division are scheduled, with additional operational assessments anticipated to continue refining the system.

According to a February 24 research note by Stonegate Capital Partners Analyst Dave Storms, EOS reported its financial results for FY25, noting a revenue of AU$126.3 million, a gross margin of 63%, and an EBITDA of US$(24.4 million). The decline in revenue was primarily attributed to the divestment of EM Solutions and a shift in the timing of order conversions, which are expected to materialize in FY26.

At the end of the year, EOS had a strong cash position of AU$106.9 million and significant order momentum, having signed 18 contracts worth approximately AU$420 million, Storms noted. The company also reported an unconditional order book of about AU$459 million (excluding Korea), indicating robust delivery expectations through FY26 to FY28, particularly as the company shifts focus towards higher-value products like RWS (Remote Weapon Systems), counter-drone systems, and HELW (High Energy Laser Weapons).

A significant development in EOS's operations is the contract with the Dutch government for a 100kW HELW system, valued at approximately AU$125 million, Storms said. To support this and future contracts, EOS opened a new HELW production facility in Singapore on February 6. This facility, spanning 20,000 square feet with an initial capacity for about 20 systems per year and potential expansion to 40 systems per year, is set to play a crucial role in the company's growth. The execution on the Netherlands program is progressing well, with initial design approvals completed in the fourth quarter of FY25 and revenue and cash milestones already recognized, which are expected to continue through 2026 to 2028.

Looking ahead, EOS is focusing on a growth strategy that combines organic development and strategic acquisitions, with particular emphasis on enhancing its counter-drone and RWS capabilities in the short term and scaling its HELW operations over the next few years, the analyst said. The company is well-positioned to benefit from strong European rearmament trends, with ongoing discussions about expanding the scope and accelerating the delivery timelines of existing contracts.

"We use both a DCF Analysis and Comparable Analysis to inform our valuation of EOS," Storms continued. "Our DCF analysis arrives at a valuation range of AU$7.10 to AU$8.36 with a midpoint of AU$7.67. For the Comparable Analysis we arrive at a valuation range of AU$7.45 to AU$8.14 with a midpoint of AU$7.79."

According to FactSet, at least three other analysts have rated the stock, including Bastian Brach of Montega AG with a Buy rating and a US$16 price target, Owen Humphries of Canaccord Genuity with a Buy rating and a US$12.50 price target, and John Lawlor of Ord Minnett with a Buy rating and a US$12.95 price target.

¹About 2% of the company is owned by insiders and management, about 14% by strategic corporations, and about 32% by institutions. The rest is retail.

Top shareholders include Washington H. Soul Pattinson and Co. with 9.12%, The Vanguard Group Inc. with 5.1%, EOS Loan Plan Pty. Ltd. with 4.87%, Fidelity Management & Research Co. with 3.65%, and State Street Investment Management Australia with 3.35%.

Its market cap is AU$2.03 billion with 192.95 million shares outstanding. It trades in a 52-week range of AU$1.10 and AU$11.80.

Red Cat Holdings Inc.

Red Cat Holdings Inc. (RCAT:NASDAQ), headquartered in the United States, specializes in providing sophisticated drone and robotic solutions across all domains for defense and national security purposes, according to its website.

The company operates through its subsidiaries, Teal Drones and FlightWave Aerospace, which are instrumental in developing American-made hardware and software. These technologies are designed to support a variety of operations for military, government, and public safety sectors, encompassing air, land, and sea environments.

The company's product lineup is highlighted by its Family of Systems, which includes the Black Widow™, a leader in small, unmanned aircraft systems (sUAS). These systems are noted for their exceptional tactical capabilities, catering specifically to the nuanced demands of modern defense operations.

Moreover, Red Cat is broadening its technological reach into the maritime domain with the establishment of Blue Ops, Inc. This expansion involves the innovation of uncrewed surface vessels (USVs), which are integrated platforms aimed at enhancing safety and effectiveness across multi-domain missions.

Last month, the company announced a significant strategic partnership with Spetstechnoexport (STE), a state-owned enterprise under Ukraine's Ministry of Defense. This collaboration aims to advance the development of next-generation unmanned and robotic systems across air, land, and maritime domains. The partnership was formalized through a memorandum of understanding that sets a cooperative framework to enhance the integration of advanced technologies, expand production capabilities, and facilitate broader access to defense innovations from both the U.S. and Ukraine in global markets.

The alliance marks Red Cat as one of the first U.S. companies to formally engage with a Ukrainian state-owned defense enterprise on multi-domain unmanned systems. Earlier in the month, a joint event in Ukraine featuring Red Cat and STE brought together defense stakeholders, technology developers, and operational end-users. This gathering aimed to showcase emerging unmanned systems and explore further opportunities for cooperation.

Chris Ericson, Chief Operating Officer at Red Cat, emphasized the significance of this partnership in a company news release, stating, "This partnership reflects a fundamental shift in how allied nations collaborate to rapidly develop, scale, and deploy unmanned systems."

He highlighted Ukraine's role as a critical testing ground for new defense technologies and STE's pivotal role in linking these innovations with global partners. Ericson expressed that the collaboration would create a pathway to accelerate capability development and deliver mission-ready solutions across multiple domains.

STE is recognized as a crucial integrator within Ukraine's defense technology ecosystem, responsible for facilitating international partnerships, coordinating exports, and scaling advanced systems for operational deployment. Red Cat plans to work closely with STE and Ukrainian developers to pursue joint initiatives that meet the evolving mission requirements in contested environments, the company said.

This collaboration aligns with Red Cat's broader strategy to deliver a fully integrated Family of Systems. This strategy involves combining aerial, ground, and maritime platforms with secure communications and scalable manufacturing to support comprehensive military and security operations.

John Newell of John Newell & Associates provided an optimistic analysis of Red Cat Holdings Inc., noting a significant positive trend in the company's stock performance. According to his January 21 report, Red Cat's stock chart showed a progression from a "base-and-breakout setup" to "a sustained uptrend with higher highs, higher lows, and repeatable pullbacks that respect key Fibonacci support." Newell highlighted that the company's stock had not only met but exceeded all early targets, shifting the narrative from questioning the stock's viability to speculating on the extent of its upward trend. He pointed out that the stock had surpassed a "big picture target of US$6.50" decisively, indicating a structural change in its behavior. Since then, the stock entered a more volatile yet constructive phase, consistently finding support near the 0.618 Fibonacci retracement level during pullbacks. Newell suggested that this behavior is indicative of a stock that is gathering momentum for further gains, with clear next upside objectives, including initial resistance near US$22.50 and a higher target zone around US$23.25.

In a separate analysis, Needham & Company, through analyst Austin Bohlig, reiterated a Buy rating on Red Cat Holdings with a price target of US$16.00, as per their March 2 report. The report followed Red Cat's Innovation Day, which left analysts more impressed with the company's development as a multi-domain unmanned operating platform. During the event, Red Cat showcased its capabilities through a live demonstration involving its Variant 7 uncrewed surface vessel and multiple Black Widow systems in a simulated tactical mission. This demonstration was pivotal as it marked Red Cat's transition from being a single-platform drone manufacturer to a comprehensive multi-domain unmanned systems provider, officially launching its Variant 7 USV.

Needham & Company expressed increased optimism about Red Cat's growth trajectory for 2026, noting the availability of over US$2 billion in direct Department of War program funding for its uncrewed surface vessel and unmanned aerial systems portfolio. The report also highlighted Red Cat's strategic focus on manufacturing expansion, quoting CEO Jeff Thompson's statement that "the factory is the weapon," emphasizing the importance of production capacity in the defense technology sector. This approach positions Red Cat to compete effectively based on throughput capabilities, not just on technological innovation.

FactSet reported at least three other analysts cover Red Cat, including Michael Latimore of Northland Securities, who has a Buy rating with a US$22 price target on the stock, Michael F. Legg Sr. of Ladenburg Thalmann & Co., who has a Buy rating with a US$20 price target, and Ashok Kumar of ThinkEquity, who has a rating of Buy with a US$20 price target.

¹The ownership breakdown of Red Cat is 11% is held by insiders and management, 43% by more than 280 institutions, and the remainder by retail investors.

The largest shareholder overall is Red Cat CEO Jeffrey Thompson with 10.66%.

The company has 121.14 million shares outstanding, a market cap of US$1.53 billion, and a 52-week range of US$4.60 to US$18.78.

RTX Corp.

Prominent aerospace and defense company Rtx Corp. (RTX:NYSE) serves a global clientele that includes commercial, military, and government sectors and operates through three main segments: Collins Aerospace, Pratt & Whitney, and Raytheon, each specializing in different areas of aerospace and defense technology, according to a company profile on Investing.com.

The Collins Aerospace segment provides a wide array of aerospace and defense products along with aftermarket services and Pratt & Whitney focuses on supplying aircraft engines for a variety of users including commercial, military, business jet, and general aviation customers, Investing.com said.

The Raytheon segment is dedicated to providing advanced defensive and offensive systems that include threat detection, tracking, and mitigation for both government and commercial customers. This includes a range of sensors, mission orchestration, satellite control products, and software solutions designed to enhance security and operational capabilities.

Raytheon recently demonstrated the effectiveness of its Coyote® Block 3 Non-Kinetic (NK) C-UAS system during a U.S. Army exercise in Tucson, Arizona. The event, which the company held on February 11, showcased the system's ability to successfully counter and defeat drone swarms. The Coyote Block 3NK, known for its counter-unmanned aircraft capabilities, impressed observers with its proficient launch, flight, intercept, and recovery operations.

This particular model is designed to engage and neutralize drone swarms using a non-kinetic payload, which significantly reduces the risk of collateral damage, Raytheon said. One of the notable features of this system is its capability to be recalled and redeployed for multiple engagements.

The Coyote system is available in both kinetic and non-kinetic variants, providing solutions that can address threats from small to large drones at longer ranges and higher altitudes than other similar class effectors.

Tom Laliberty, president of Land & Air Defense Systems at Raytheon, emphasized the system's cost-effectiveness and its role in enhancing defense capabilities against individual drones and swarms.

"Coyote provides warfighters a cost-effective defense for individual drones and swarms," he said. "We continue to invest in Coyote's combat-proven capabilities, ensuring that allies around the globe gain an affordable operational advantage over sophisticated and evolving drone threats."

RTX has been highlighted as one of the top eight drone stocks to invest in over the next three years, according to a report by Insider Monkey's Ashar Jawad published by Yahoo! Finance on March 16. This recognition comes from a recent report on TipRanks, where Morgan Stanley analyst Kristine Liwag reaffirmed an Overweight rating on RTX's stock with a price target of US$235 on March 7. This updated target follows a previous increase from US$215, which was prompted by RTX's strong performance in the fourth quarter. As of March 13, RTX Corporation is rated as a Strong Buy, with an anticipated average share price upside potential of 11%.

In related developments, RTX Corporation announced recently that Raytheon had completed a significant US$115 million expansion of its missile integration facility located in Alabama, which is expected to boost the facility's delivery and integration capacity by over 50%. This move is part of RTX's ongoing efforts to meet increasing demands, following an agreement last month with the Department of War to enhance the production and delivery of Tomahawks, AMRAAM missiles, and other missile systems.

According to a report by Zacks posted on Financial Visualizations on March 9, the company currently carries an average brokerage recommendation (ABR) of 1.86, which places it between Strong Buy and Buy on a scale from 1 to 5, where 1 is Strong Buy and 5 is Strong Sell.

This rating is based on the evaluations of 22 brokerage firms, the report said. Out of these evaluations, 13 firms have given RTX a Strong Buy rating, and one firm has rated it as Buy. Collectively, the Strong Buy recommendations constitute 59.1% of all the recommendations, while the Buy recommendation makes up 4.6%. This favorable consensus reflects a positive outlook on RTX by a majority of the analysts covering the stock.

According to FactSet, at least 14 analysts have rated the stock, including Deutsche Bank Research analyst Scott Deuschle with a Buy rating and a price target of US$240, Jefferies analyst Sheila Kahyaoglu with a Hold rating and a price target of US$210, RBC Capital Markets analyst Ken Herbert with a Buy rating and a price target of US$230, Vertical Research Partners analyst Robert Stallard with a Buy rating and a price target of US$227, Melius Research analyst Scott Mikus with a Buy rating and a price target of US$242, Wells Fargo Securities analyst David Strauss with a Hold rating and a price target of US$200, Susquehanna Financial Group analyst Charles P. Minervino with a Buy rating and a price target of US$235, TD Cowen analyst Gautam Khanna with a Buy rating and a price target of US$225, Morningstar Equity Research analyst Nicolas Owens with an Underweight rating and a price target of US$179, Langenberg LLC analyst Brian K. Langenberg with a Sell rating and a price target of US$190, Argus Research analyst Kristina Ruggeri with a Buy rating, Mega Intl Invst Serv analyst Alec Huang with a Hold rating and a price target of US$203, Baptista Research analyst Ishan Majumdar with a Hold rating and a price target of US$212, and Alembic Global Advisors analyst Pete Skibitski with a Buy rating and a price target of US$233.

¹Less than 1% of the company is owned by insiders and management, and about 81% is owned by institutions. The rest is retail.

Top shareholders include The Vanguard Group with 9.24%, State Street Investment Management with 6.83%, BlackRock Institutional Trust Co. with 5.75%, Capital Research Global Investors with 5.66%, and Capital International Investors with 3.31%.

Its market cap is US$263.53 billion with 1.3 billion shares outstanding. It trades in a 52-week range of US$112.63 and US$214.50.

Conclusion: 'A Flurry of New Orders'

Since the onset of the US and Israeli-led war against Iran on February 28, Iran has been employing a strategy of retaliation against U.S. and allied targets in the Gulf region, utilizing both ballistic missiles and Shahed drones, according to a report by Tom Pashby for Resilience Media on April 21.

The Shahed drones, noted for their cost-effectiveness, range between US$20,000 and US$50,000 each, presenting a stark contrast to the much more expensive missile defense systems used by the US and its allies, which can cost from hundreds of millions to billions of dollars.

This significant cost disparity has sparked discussions about shifting focus towards more cost-effective defense solutions. However, defense tech startups have expressed concerns to Resilience Media about the slow adoption of innovative, lower-cost interceptor drone-based C-UAS. They cite lengthy procurement cycles and a lack of training on new systems as major obstacles.

In related developments, Pashby said NATO is increasingly focusing on the use of coordinated drone swarms as the next "evolution" of uncrewed aerial systems (UAS), which are reshaping modern warfare. Iain Lamont, the UK head of Applied Intuition, highlighted the transformative impact of UAS on the battlespace. Applied Intuition recently led a consortium, awarded the first phase of the Defence and Science Technology Laboratory's Software Defined Swarms contract, to develop an autonomy test bed for drone swarms.

Iran has launched thousands of drone and missile attacks across the region, with only a relatively small number hitting significant targets, according to Andrew Dardine writing for Defense and Security Monitor on March 27. This is largely due to the Middle East being one of the most heavily defended regions against drones, a status that predates the current conflict involving the U.S. and Israel.

"Recent weeks have seen a flurry of new orders for air defense systems and C-UAS, particularly, of U.S. made systems through the Foreign Military Sales (FMS) program, further shoring up an already C-UAS rich region," Dardine said.

Beyond the immediate conflict zone, the C-UAS market continues to expand globally with various regions actively pursuing drone defense capabilities, the article said.