Fund Manager Summary
The fund managers believe that the outlook for Electro Optic Systems Holdings Ltd is promising due to its position as a preferred defence contractor on the ASX. In their opinion, the company is well-positioned with net cash and is entering a long contracting cycle, which should enhance its financial stability. They note that strong macro tailwinds in the defence sector are likely to drive both earnings and investor sentiment, making it an attractive investment opportunity.
Source: Trading View
Commentary From The Managers
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Katana Asset Management
31 Oct 2025
$6.21
Summary
- Katana Asset Management notes an extraordinary rally in Electro Optic Systems Ltd (EOS), with the stock tripling in value since June.
- During October, the stock price retraced approximately 40%.
- Katana Asset Management capitalized on this misplaced exuberance to lock in substantial profits.
- As a result, the holding is now free carried in the fund.
- The profits realized from EOS have exceeded the entire purchase cost of the position.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Katana Asset Management
31 Oct 2025
$6.21
- Katana Asset Management notes an extraordinary rally in Electro Optic Systems Ltd (EOS), with the stock tripling in value since June.
- During October, the stock price retraced approximately 40%.
- Katana Asset Management capitalized on this misplaced exuberance to lock in substantial profits.
- As a result, the holding is now free carried in the fund.
- The profits realized from EOS have exceeded the entire purchase cost of the position.
Summary
Wilson Asset Management
30 Sept 2025
$10.22
- Electro Optic Systems Holdings (EOS) is an Australian technology firm focused on electro-optic systems for defence, space, and communications.
- NATO's commitment to increase defence expenditures from 1-2% of GDP to 5% is expected to enhance the prospects for defence contractors.
- EOS has a substantial pipeline of prospective contract opportunities, positioning it well for future growth.
- Wilson Asset Management continues to hold EOS as they are positioned to leverage these momentum drivers.
- The S&P/ASX 300 inclusion in early September is seen as a significant catalyst for inflow.
Summary
Katana Asset Management
30 Sept 2025
$10.22
- Electro Optic Systems Holdings Ltd (EOS) has emerged as a standout performer in Katana Asset Management's portfolio.
- EOS is now the fourth stock in Katana’s 19-year history to exceed a weighting of 5% of the portfolio's value.
- The fund manager has maintained this position through a dramatic share price rise, demonstrating confidence in their investment process.
- Katana Asset Management continues to hold its position in EOS, reflecting a long-term commitment to its investment strategy.
Summary
Glennon Small Companies
30 Sept 2025
$10.22
- Glennon Small Companies sold their investment in EOS (Electro Optic Systems) after a 36.07% increase in shares during the month.
- The rise was fueled by investor excitement regarding EOS's advanced defense and laser technologies.
- Recent contract wins, including an export order to a European NATO country, contributed to the positive momentum.
- The share price increase reflected high expectations in the defense tech sector.
- Given the volatility and uncertainty surrounding aerospace and defense contracts, it was deemed an appropriate moment to take profits.
Summary
Katana Asset Management
31 Aug 2025
$5.81
- Katana Asset Management considers EOS an unusual holding due to its lack of alignment with key criteria on earnings visibility.
- Portfolio Manager Giuliano Sala Tenna conducted an extensive site visit to EOS's R&D facilities in Canberra.
- This effort emphasized EOS’s unique position in drone warfare technology.
- The current historical context sees armies globally crossing the automated warfare Rubicon.
- Looking ahead, Giuliano anticipates significant upside potential from current levels.
- The rapid rerating of the stock price suggests potential for swift and aggressive drawdowns.
- Despite the risks, EOS’s unique offering in a pivotal moment in history indicates a strong trajectory for the company.
Summary
Katana Asset Management
30 June 2025
$2.85
- Electro Optic Systems Holdings Ltd is viewed as a preferred defence contractor on the ASX.
- Katana Asset Management continues to hold due to the company's net cash position and the commencement of a long contracting cycle.
- There are strong macro tailwinds in the defence sector that are likely to drive earnings and sentiment.
Summary
Katana Asset Management
31 May 2025
$1.89
- Katana Asset Management continues to hold its position in Electro Optic Systems Holdings Ltd. (EOS).
- The fund has increased its holding in EOS following a significant contract win.
- EOS is expected to enter a major upgrade cycle, enhancing its growth potential.
- This contract win positions EOS favorably in the market.
- Overall, Katana Asset Management remains optimistic about EOS's future prospects.
Summary
Clime Investment Management
31 Oct 2024
$1.44
- EOS positively contributed to October’s performance, driven by promising financial and operational progress in its quarterly report.
- Customer receipts were up significantly from the prior quarter, while net operating cash flow turned positive.
- EOS secured new contracts across the Middle East, Australia, and Europe, reflecting its growing market presence.
- Key highlights include advanced negotiations on high-value deals, like Australia’s Land 400 Phase 3 and a potential North American RWS contract.
- Clime Investment Management exited their position in EOS in October as its strong share price appreciation pushed it closer to a full valuation.
- This appreciation was largely due to solid performance in its Remote Weapon Systems (RWS) and communications divisions.
- While EOS’s space and targeted energy initiatives show exciting potential, more clarity is needed before factoring these prospects into valuation.
- By locking in gains now, Clime Investment Management retains the flexibility to re-evaluate EOS’s growth trajectory as developments in these high-potential segments materialise.
Summary
Clime Investment Management
31 May 2024
$1.28
- EOS was a detractor in May, with some momentum easing after a significant share price rally.
- Clime Investment Management remains optimistic about the company's prospects.
- A recent site visit highlighted impressive demonstrations, including the Directed Energy laser and R400 Remote Weapons System.
- The chairman’s address at the AGM emphasized a strong financial turnaround, record revenue, and promising diversification in their product range.
- Ongoing demand from the Russia/Ukraine and Israel/Palestine conflicts serves as a significant tailwind.
- Management expects this demand to persist for at least seven years as countries aim to meet their desired weapon inventories.
- With a solid order book and potential for significant contracts, Clime Investment Management maintains a positive outlook on EOS's long-term prospects.
Summary
Clime Investment Management
31 Mar 2024
$1.65
- EOS experienced a share price retreat in March as it consolidated after significant appreciation.
- The company raised $35 million in capital to seize near-term growth opportunities amidst heightened geopolitical tensions.
- Despite the equity raise impacting momentum, Clime Investment Management remains confident in EOS' prospects.
- EOS is implementing a revamped strategy focusing on high-margin products and disciplined capital management.
- Partnerships with global defense contractors are expected to accelerate sales.
- The company has a strong order book and pipeline, positioning it well to meet the growing demand for advanced defense solutions.
- Clime Investment Management initiated a position in EOS due to its compelling turnaround story related to counter-drone defense capabilities.
- With affordable drone technology disrupting warfare, EOS' laser-guided remote weapon systems are strategically positioned.
- The capital raise is aimed at funding strategic inventory buildup, which could translate into at least $275 million in potential revenue over the next few years.
- Under new leadership, EOS has refocused on core proficiencies, achieving a 59% revenue surge and positive EBITDA in FY23.
- Clime Investment Management sees an attractive risk/reward profile in this underappreciated Australian defense innovator.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
ANALYST INSIGHT
Equity Research Analyst
"With strong macro tailwinds in the defense sector, it appears that Electro Optic Systems Holdings Ltd could be poised for a significant upswing. As a preferred contractor on the ASX, the potential for earnings growth seems promising amidst a long contracting cycle."
Last Updated: 31 Oct 2025
Query The Data
Frequently Asked Questions
Who is investing in Electro Optic Systems Holdings Ltd (ASX:EOS)?
Fund managers including Katana Asset Management, Clime Investment Management and Wilson Asset Management have invested in Electro Optic Systems Holdings Ltd (ASX:EOS).
Why do fund managers invest in Electro Optic Systems Holdings Ltd?
Fund managers are investing in Electro Optic Systems Holdings Ltd due to its status as a preferred defense contractor on the ASX, its strong financial position with net cash, and the initiation of a long contracting cycle. Additionally, favorable macroeconomic trends in the defense sector are expected to enhance earnings and improve market sentiment.
What happened to Electro Optic Systems Holdings Ltd (ASX:EOS)?
Fund managers are investing in Electro Optic Systems Holdings Ltd (EOS) due to its unique position in the drone warfare technology sector and significant upside potential amid increasing global defense expenditures. Recent comments highlight EOS's strong trajectory, bolstered by NATO's commitment to elevate defense spending and a substantial pipeline of contract opportunities. The stock's rapid price appreciation and inclusion in the S&P/ASX 300 further enhance its appeal, making it a standout performer in their portfolios.