3 booming ASX shares for the new space age

These 3 ASX shares are playing an outsized role in the global space industry. Each high performing company is a pioneer in its field.

| More on:
rising asx share price represented by rocket ascending increasing piles of coins

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Four Corners episode on The New Space Age aired on 31 Aug 2020. As always, the program presented a fantastic documentary, this time on the rush into space and the part Australia is playing in it. Moreover, it also focused on the international tensions and competitiveness arising out of the space race. In addition, throughout the program, several themes emerged in which some ASX shares are already deeply embedded.

Whilst I believe Australia does not have enough companies working in this area, those that have made inroads are punching above their weight.

Space situational awareness

This was one of the most fascinating parts of the program for me. Every time humans send something into space, we create more space junk in orbit. Current scientific consensus is that there are around 500,000 pieces of space debris larger than 1 cm in Earth's orbit. Travelling at 30,000 km per hour, junk as small as 1 cm will severely damage or destroy a satellite on impact.

Electro Optic Systems Holdings Limited (ASX: EOS) is one of the early pioneers in this area through its sensor technology. For over 40 years, this ASX share's laser technology has been the standard for all space data and catalogues. Moreover, Electro Optic space tracking and debris monitoring systems now provide the benchmark for space catalogue acquisition and maintenance.

Situational awareness is increasingly important to identify active and expired satellites and orbital debris to reduce the likelihood of collisions. In addition, Electro Optic has built and operates the world's only autonomous (robotic) space laser tracking system.

Computing power in space

Brainchip Holdings Ltd (ASX: BRN) has developed an artificial intelligence (AI) technology that is ideally suited for use in space. Moreover, this ASX share has recently partnered with space mission veteran Vorago Technologies. To illustrate further, Vorago is currently in the process of planning for 19 upcoming space missions.

The Brainchip technology is well suited to space missions because it is an advanced AI chip with a low power requirement. The chip is a complete neural processor and does not require an external CPU, memory or deep learning accelerator. The reduction in component count, size and power consumption are paramount concerns for aerospace and spaceflight applications. In addition, because of the nature of this new technology, it provides for continuous operation when new discoveries or unforeseen circumstances occur.

ASX shares for space materials

Carbon composites are used throughout most assets that travel into space. It is lighter, can handle high temperatures, and has very low thermal expansion. Xtek Ltd (ASX: XTE) is a defence materials ASX share which signed an agreement with the Australian Space Agency in 2019. The agreement was to further develop its lightweight composite materials for application within the space flight industry.

Furthermore, Xtek has been working with private firm, Skykraft, since 2019. This resulted in a grant from the Space Agency to design a small satellite launch stack. Skykraft is developing technology to launch what it calls constellations of satellites. These are low orbit satellites that work together on a areas such as communication, travel, banking, and security.

The concept of constellation of satellites is not new. NASA has tried this before with large satellites. However, due to cost reductions brought about by Elon Musk's SpaceX, lightweight Xtek materials are likely to enable constellations of small scale satellites.  

Foolish takeaway

Yet again, ASX shares are punching above their weight in an industry of global importance. Moreover, companies like Electro Optic are already deeply ingrained in the management of issues related to space missions. I believe Brainchip is also likely to see its technology become the new standard for computing power in space, particularly given the advanced nature of its chip. Lastly, the Xtek work with Skykraft is also carving out a new niche in the space industry. If successful, it will also change how we engage with the final frontier. 

Aside from their work in space, each of these ASX shares plays a key role in defence and security markets globally.

Daryl Mather owns shares of Electro Optic Systems Holdings Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Electro Optic Systems Holdings Limited. The Motley Fool Australia has recommended Electro Optic Systems Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

Happy young woman saving money in a piggy bank.
Share Market News

Buy these ASX dividend shares to beat term deposits

These shares could be superior to term deposits according to analysts.

Read more »

The silhouettes of ten people holding hands with their arms raised against the sky, as the sun rises or sets in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

The ASX was back to the races this Tuesday.

Read more »

A young woman sits with her hand to her chin staring off to the side thinking about her investments.
Opinions

Could Soul Patts shares hit $50 in 2025?

This company jumped more than 16% yesterday.

Read more »

Stethoscope with a piggy bank in the middle.
Broker Notes

Australian health insurance: Does Macquarie prefer Medibank or NIB shares?

Medibank and NIB shares have both surged in 2025. Here’s what Macquarie expects now.

Read more »

A woman reaches her arms to the sky as a plane flies overhead at sunset.
Travel Shares

Why the Qantas share price soared 20% in May to new all-time highs

With another stellar month in May, Qantas shares are up more than 79% in a year.

Read more »

Man smiling at a laptop because of a rising share price.
Broker Notes

9 ASX 200 shares just upgraded to strong buy ratings

Brokers have upgraded these shares amid expectations of price growth over the next 12 months.

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Share Gainers

Why DroneShield, Judo, Pepper Money, and Strickland shares are surging today

These shares are having a good session on Tuesday. But why?

Read more »

A young woman holds an open book over her head with a round mouthed expression as if to say oops as she looks at her computer screen in a home office setting with a plant on the desk and shelves of books in the background.
Share Fallers

Why Elders, IDP Education, Life360, and Pilbara Minerals shares are falling today

Let's see why investors are selling these shares.

Read more »