Electro Optic Systems Holdings Limited (ASX: EOS) operates predominantly in two sectors, i.e., Defence Systems and Space Systems. On 14 February 2019, the company has stated through a release on the exchange that in the past 72 hours, the global media has reported a series of significant developments in the market for EOS space data. The critical elements in the increased media coverage of the strategic developments in the space environment are as follows:
US Transparency: US Department of Defence has been increasingly transparent about the US military reliance on space assets, and the vulnerability of those assets to countermeasures by strategic competitors and rogue states. This transparency has largely extended to consideration of solutions by Congress.
Space Force Formation: The US government has recently announced the imminent formation of a US Space Force to focus on space as a domain for national security. US Space Force will have a nominal budget of around US$14 billion annually when fully established in 2-3 years. A complimentary Space Development Agency will also be established to accelerate adoption of new military technologies for space.
Commenting on these developments, the Group CEO, Dr. Ben Greene said that the defence of space assets is an asymmetric process, requiring much more investment for defence than for attack. As space capability proliferates to more nations the cost of protecting national security assets in space is escalating.
He also emphasized that there is a very high value in the installed asset base in space. Threats to these assets are proliferating rapidly. Even with expanding outlays by the US and its allies, the cost of space asset protection is not sustainable with current tools. The first requirement for space asset protection is more accurate information about the space environment. The company’s sensors providing information to support defensive space operations are less expensive and more capable than legacy technology. The price and performance of the company’s sensors, proven through extensive trials, can make a significant contribution. He told that the company’s space sensors are based on lasers, so they are particularly well qualified for defensive activities against the current weapon-of-choice against most satellites.
The precision data capacity of the company’ private space sensor network already exceeds that of most countries. The recent public disclosures of the issues emerging in military space enhance the company’s confidence that these issues will be coherently addressed, and that negotiations currently in process will lead to a commercial role for the company in implementing solutions.
Now, let us have a quick look at Electro Optic Systems Holdings Limited’s stock performance and the return it has posted over the last few months. The stock is currently trading at a price of $2.60, trading up by 5.645% during the day’s trade with a market capitalisation of ~$ 238.34 Mn. The counter opened the day at $ 2.500, reached the day’s high of $ 2.630 and touched the day’s low of $ 2.500 with a daily volume of 192,607. The stock has provided a YTD return of 0.81% & also posted returns of -9.82%, -10.14% & 5.53% over the past six months, three & one-months period respectively. It had a 52-week high price of $ 3.350 and touched 52 weeks low of $ 2.250, with an average volume of 107,953 approximately.
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