DroneShield points to Capital Brief article after selloff
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More news: Responding to a price query from the ASX, DroneShield has said there is no new information or change of circumstances around the business that would have caused the plunge in its share price during trading today.
However, it pointed to Capital Brief's earlier coverage that detailed that short sellers were circling the company, betting that its share price momentum was unsustainable as it approached a market capitalisation of $2 billion.
DroneShield shares paused after nosedive
The news: Anti-drone defence tech company DroneShield is in a temporary pause in trading after its shares took a nosedive, as the company approaches a $2 billion market cap.
The numbers: DroneShield shares were down 28.46% to $1.86 by the time of the halt at 1:53pm AEST.
At market open today, DroneShield hit its record high price of $2.71 — a 700% increase from a year earlier.
The context: Some sceptics have begun to short the stock, viewing the market capitalisation and rapid growth as a major overvaluation.
On Monday, DroneShield closed at $2.6 a share, giving it a market cap of $1.98 billion, making its equity more valuable on paper than Air New Zealand and Magellan Financial, and nearly as valuable as Nine Entertainment.
Prior to the selloff, DroneShield shares had been climbed steadily, buoyed in particular by the announcement of a $5.7 million contract with the US government in May.
The sources: ASX announcement, ASX announcement
