Low-Priced Drone Name Sees Encouraging Bounce With Substantial News Ahead
As market players shrug off concerns about downside revisions, I'm watching this name in a hot sector.
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On Monday morning, market players are shrugging off the concerns about major downside revisions that hit the market on Friday. Part of the reason is increased optimism that the Fed will have no choice but to cut interest rates at its next meeting in September, but there also are investors who are optimistic about the economic moves that have been made by the Trump administration.
While there is some softening in the employment picture, the impact of the "big, beautiful bill" is yet to hit, and there are still few signs that tariffs are driving a sharp increase in inflation as many "experts" had predicted.
The market has needed a rest for a while, and the jobs news and the "sell the news" response to Amazon AMZN and Apple AAPL were good excuses. The issue now is if there is already some nearby support, or will the lows hit on Friday be tested.
Personally, I'm rooting for some deeper pullbacks so that the charts can develop with greater support. We are heading into the weakest period of the year for the market, so let's get the corrective action underway and set up conditions for a year-end rally.
There are lots of small-cap earnings reports coming up in the next week, which will make for some interesting trading.
One low-priced, small-cap name on my radar is in a very hot sector — drones. Ondas Holdings, Inc. ONDS, through its subsidiaries American Robotics and Airobotics, designs, develops and markets commercial drone solutions, including the Optimus System, Scout System and Iron Drone Raider. These are AI-powered, highly automated "drone-in-a-box" systems for remote operation, used for data collection, surveillance and counter-drone security in industries like defense, homeland security, public safety, rail, energy, mining and agriculture. They offer services under a Robot-as-a-Service (RAAS) model and have achieved regulatory milestones, such as FAA approval for beyond-visual-line-of-sight (BVLOS) operations without onsite human operators.
On Monday, August 4, ONDS announced the successful completion of pilot programs with governmental homeland security agencies in Europe and Asia. These programs involved extensive testing of the Iron Drone Raider system in a range of operational scenarios, including GPS-denied environments, interception of various maneuvering aerial targets and the use of net-and-parachute capture technology to minimize collateral damage. One of the programs also included integration with third-party command-and-control and drone detection systems. Both pilot programs concluded with the Iron Drone Raider receiving excellent performance evaluations, validating its capabilities in real-world operations and setting the stage for scaled, long-term deployments.
Ondas has had a number of important technical developments in recent months and is in a position to start announcing substantial contracts. The Pentagon has recently announced that it plans to help increase low-cost drone production in the U.S.
Technically, the stock hit a high of $2.70 on July 21 after announcing it was retiring its outstanding convertible notes. The stock pulled back to the 50-day and is now bouncing on the positive news flow. I am looking for a retest of the $2.50 areas. Keep an eye on volume, which is running well above average.
Ondas is a low-priced name, but it's in a "hot" sector and is seeing increased attention as speculative traders look for some action.
At the time of publication, DePorre was long ONDS.
