Winding back to midway this year, DroneShield Ltd (ASX: DRO) shares were all the rage.

Stock in the counter-drone technology company soared from 38 cents apiece in January to $2.60 by July 15, a 6.8x return.

But the tides turned in the back half of the year, with shares retreating to their current levels of 65.5 cents apiece, following a 22% drop in the last month alone.

Now that we're nearing the end of the year, what's the outlook for DroneShield shares in 2025? Let's see what the experts say.

What's weighing on DroneShield shares?

DroneShield shares were heavily bought early in the year. This came after it announced a number of major contract wins with the US Department of Defense (DoD) and private customers.

Expectations were set tremendously high for the counter-drone technology player. And we're measuring expectations by share price here.

But shares were heavily sold after the company peaked at a market value of over $2 billion in July, followed by more selling on its half-year earnings and scathing equity research from Capital Brief.

The company then raised $120 million via an underwritten placement in August. It issued over 104 million additional shares as part of the fund raising, diluting shareholders by that amount.

DroneShield shares were heavily sold once more afterwards. Because investor expectations were set so high (baking in loads of growth potential, versus the current business), investors were likely easily disappointed.

The bright spots

Despite the market fluctuations, DroneShield continues to chug along doing business. Its third-quarter earnings showed quarterly cash receipts reached a record $9.1 million, up 18% year on year.

Management now projects 2024 revenue could hit $55 million, underscored by $24 million worth of products delivered or scheduled for the final quarter.

The company boasts a $1.1 billion sales pipeline, with $18 million in contracted revenue already locked in for 2025.

The company also secured an $8.2 million repeat order from a European customer last week. The order is expected for delivery early next year.

Bell Potter recently revised DroneShield shares to a buy with a price target of $1.20 apiece.

But the broker also tempered its earnings expectations, slashing forecasts for FY24 by 57% due to higher operating expenses.

Meanwhile, consensus broker estimates place DroneShield shares as a buy, according to CommSec.

Foolish takeaway

DroneShield shares have gyrated in 2024, but experts reckon the company's order pipeline, combined with increasing global demand for counter-drone technology, positions it well.

It's up to management to execute on the objective now. Time will tell if it fulfils this mandate.

In the last 12 months, the stock has held onto a 104% gain.