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Draganfly (TSE:DPRO)
:DPRO
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Draganfly
(NASDAQ:DPRO)
48Neutral
Positive Factors
Earnings
DPRO shares have increased 65.0% since reporting 3Q24 operating results, showing strong performance compared to the Russell 2000 index.
Market Opportunity
The exclusion of DJI could unlock considerable demand for qualified competitors like DPRO.
Negative Factors
Financial Performance
DPRO will need to raise additional capital in 1H25 and before reaching breakeven in 2027, indicating ongoing financial challenges.
Draganfly (DPRO) vs. S&P 500 (SPY)
Market Cap
$17.75M
Dividend YieldN/A
Average Volume (3M)4.66K
Price to Earnings (P/E)―
Beta (1Y)1.43
Revenue Growth-15.66%
EPS Growth77.35%
CountryCA
Employees54
SectorIndustrials
Sector Strength69
IndustryAerospace & Defense
Share Statistics
EPS (TTM)-5.54
Shares Outstanding5,427,795
10 Day Avg. Volume4,903
30 Day Avg. Volume4,655
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.29
Price to Cash Flow (P/CF)-1.10
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$10.11Price Target Upside209.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Draganfly Business Overview & Revenue Model
Company DescriptionDraganfly Inc is a Canada based company. It is engaged in the provision of engineering services and the manufacture of commercial unmanned vehicle systems and software. The company operates in Canada, the United States, and Internationally. It generates revenue through Product sales and Consulting. Product sales revenue consists of internally assembled multi-rotor helicopters, industrial aerial video systems, civilian small unmanned aerial systems or vehicles, and wireless video systems. Consulting service includes custom engineering and training and simulation consulting.
How the Company Makes MoneyDraganfly generates revenue through multiple streams, primarily focusing on the sale and leasing of its proprietary drone systems and related software solutions to both commercial and governmental clients. Additionally, the company provides custom engineering services and technical support, which contribute to its earnings. Draganfly's strategic partnerships with industry leaders and government agencies further bolster its revenue by facilitating the development of specialized drone applications and enhancing its market reach. The company also capitalizes on subscription-based models for its software and data analytics services, providing a recurring revenue stream.
Draganfly Financial Statement Overview
Summary
Draganfly's financial performance faces challenges with declining revenues and persistent losses. Despite a modest improvement in equity position, operational inefficiencies and cash flow deficits remain significant issues.Income Statement
The income statement shows a declining revenue trend with a decrease from $6.55M in 2023 to $5.86M in TTM (Trailing-Twelve-Months). Gross profit margin also fell significantly, while the net profit margin remains negative, indicating persistent losses. The EBIT and EBITDA margins reflect operational inefficiencies, and the company has yet to achieve profitability.35
Negative
Balance Sheet
The balance sheet reveals moderate debt levels with a debt-to-equity ratio of 0.12 in TTM. However, the equity ratio has improved to 51.1%, suggesting a stronger equity base relative to assets compared to previous periods. Despite these improvements, the company’s low return on equity and declining asset base pose concerns.45
Neutral
Cash Flow
The cash flow statement indicates negative free cash flow, although there is a minor improvement from the previous year. Operating cash flow remains negative, highlighting ongoing cash burn in operations. The operating cash flow to net income ratio suggests cash flow challenges, with heavy reliance on financing activities for liquidity.40
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 5.86M | 6.55M | 7.61M | 7.05M | 4.36M | 1.38M | Gross Profit |
| 1.14M | 2.06M | 790.67K | 2.64M | 1.76M | 1.16M | EBIT |
| -13.80M | -22.39M | -26.15M | -22.30M | -7.12M | -3.34M | EBITDA |
| -13.38M | -21.85M | -26.88M | -18.97M | -7.87M | -3.29M | Net Income Common Stockholders |
| -13.34M | -23.61M | -29.16M | -13.16M | -9.39M | -11.27M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 101.79K | 3.09M | 7.89M | 23.08M | 1.98M | 2.43M | Total Assets |
| 504.82K | 8.33M | 14.64M | 42.11M | 7.10M | 3.22M | Total Debt |
| 2.05M | 875.08K | 465.21K | 582.44K | 256.04K | 136.07K | Net Debt |
| 1.95M | -2.22M | -7.43M | -22.49M | -1.73M | -2.29M | Total Liabilities |
| 4.64M | 7.92M | 3.60M | 7.19M | 3.25M | 1.03M | Stockholders Equity |
| -4.13M | 407.72K | 11.04M | 34.93M | 3.85M | 2.19M |
| Cash Flow | Free Cash Flow | ||||
| -9.41M | -19.26M | -16.43M | -22.22M | -5.16M | -3.98M | Operating Cash Flow |
| -9.26M | -18.77M | -16.35M | -22.00M | -5.14M | -3.89M | Investing Cash Flow |
| -30.68K | -379.58K | 768.65K | -3.31M | 516.42K | -27.75K | Financing Cash Flow |
| 10.83M | 14.45M | -48.10K | 46.27M | 4.17M | 6.27M |
Draganfly Technical Analysis
Negative
3.27
Price Trends
4.53
Negative
4.51
Negative
2.86
Positive
Market Momentum
-0.41
Positive
40.30
Neutral
52.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DPRO, the sentiment is Negative. The current price of 3.27 is below the 20-day moving average (MA) of 3.77, below the 50-day MA of 4.53, and above the 200-day MA of 2.86, indicating a neutral trend. The MACD of -0.41 indicates Positive momentum. The RSI at 40.30 is Neutral, neither overbought nor oversold. The STOCH value of 52.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:DPRO.
Draganfly Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Performance Comparison
TSE:DPRO
Draganfly
3.32
3.09
1312.77%
TSE:UAV
Global UAV Technologies Ltd
0.57
0.44
338.46%
TSE:PAT
Trench Solutions
0.50
-0.70
-58.33%
TSE:RPX
Red Pine Exploration
0.10
-0.10
-50.00%
TAKOF
Drone Delivery Canada
0.12
-0.05
-29.41%
CUBXF
CubicFarm Systems
0.17
0.15
750.00%
Draganfly Earnings Call Summary
Earnings Call Date: Nov 14, 2024 | % Change Since: -11.62% | Next Earnings Date: Apr 1, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive developments, such as record-breaking Q3 revenue and significant product launches, alongside challenges including year-over-year revenue decline and reduced gross profit margins. The financial stability and strategic military and corporate partnerships are promising, but the decrease in revenue and profit margins indicates some ongoing challenges.Highlights
Record-Breaking Q3 Revenue
Draganfly reported revenue of $1.885 million for Q3 2024, marking the best Q3 in the company's history.
Launch of APEX Drone
The APEX Drone, a Category 1 drone, was launched this quarter and is receiving significant demand, especially from law enforcement.
Military and Fortune 50 Orders
Draganfly secured military orders through VRR and TB2, and a major deal with a Fortune 50 oil and gas company for drone-in-a-box solutions.
Strong Cash Position
The company reported having nearly $4 million in cash, indicating financial stability.
Lowlights
Year-Over-Year Revenue Decline
Revenue decreased by 11.8% year-over-year, from $2.1 million in Q3 2023 to $1.9 million in Q3 2024.
Gross Profit and Margin Decrease
Gross profit reduced from $895,000 in Q3 2023 to $441,000 in Q3 2024, with gross margin dropping from 42.2% to 32.7% after adjustments.
Comprehensive Loss Despite Adjustments
The total comprehensive loss for Q3 was $365,000, with adjusted loss (excluding non-cash items) at $3.8 million compared to $5.6 million a year ago.
Company Guidance
In the Q3 2024 Draganfly Earnings Call, the company reported revenue of $1.885 million, marking its best Q3 to date, with product sales contributing $1.3 million and services $0.5 million. The gross profit stood at $440,000, resulting in a margin of 23%, although adjustments for inventory write-downs suggest a more accurate margin of 32.7%. The company noted a cash position of approximately $3.9 million. Year-over-year, revenue dipped by 11.8%, and there was a significant reduction in comprehensive loss from $5.5 million to $365,000, driven by lower SG&A expenses and non-cash adjustments. Quarter-over-quarter, revenue increased by 8.8%, with a minor reduction in gross margin attributed to product mix changes. Draganfly emphasized operational highlights like the introduction of the APEX Drone and key military contracts, alongside strategic alliances, such as a Fortune 50 oil and gas firm adopting their drone-in-a-box solution. The company remains optimistic about Q4, citing a robust sales funnel and ongoing demand across various sectors, particularly for their FPV drones and the newly launched APEX Drone.Draganfly Corporate Events
Business Operations and StrategyRegulatory Filings and Compliance
Draganfly Secures FAA Waiver for Urban Drone Operations
Positive
Jan 23, 2025
Draganfly Inc. announced that it has secured a Federal Aviation Administration (FAA) waiver permitting its drones to operate over people and moving vehicles in Boston, marking a significant advancement in UAV capabilities in urban settings. This regulatory milestone reinforces Draganfly’s reputation as an innovator in the UAV space, enabling critical applications such as public safety and infrastructure inspection, and strengthening its partnerships with defense, government, and commercial sectors.
Draganfly and Volatus Aerospace Collaborate on Innovative Drone Solutions for Energy Sector
Jan 16, 2025
Draganfly Inc. has announced a strategic partnership with Volatus Aerospace to integrate advanced Bathymetric LiDAR technology with Draganfly’s Heavy Lift Drone. This collaboration aims to meet the growing demand for precision data acquisition in the energy sector, particularly for oil and gas exploration. By combining their technologies, the companies intend to improve mapping of underwater environments, thereby enhancing operational efficiency and reducing costs for clients. The agreement also allows Volatus to operate as a reseller of Draganfly’s UAV platforms, expanding its product offerings and market reach.
Draganfly Advances Drone Delivery for Healthcare
Dec 18, 2024
Draganfly Inc. successfully completed initial proof-of-concept flights for a drone delivery project aimed at enhancing healthcare logistics for Mass General Brigham’s Home Hospital. The initiative seeks to demonstrate how drones can ensure timely access to critical medical supplies, reducing delays caused by traditional delivery methods. This project marks a significant step towards revolutionizing healthcare logistics, potentially providing faster and more reliable delivery of essential supplies.
Draganfly to Train Operators at ElevateUAV Event
Nov 7, 2024
Draganfly is set to participate in the ElevateUAV event, where it will provide specialized training on its advanced drone platforms, Flex FPV and Commander 3XL. This initiative highlights Draganfly’s dedication to equipping operators with the necessary skills to enhance UAV applications in critical sectors such as public safety and emergency response.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.