- Babcock International Group
- 26 June 2025 11:01:08
Source: Sharecast
Berenberg said Babcock's FY25 results reinforced its view that the company was "well positioned" to benefit from rising defence budgets in the medium and long term after management emphasised that there was "significant growth potential" beyond its three- to five-year medium-term guidance window.
The German bank noted that this included opportunities in the UK, as well as from its growing list of partnerships with international defence companies, which offer scope for an acceleration of revenue in the coming years.
Berenberg said the shares "screen attractively", trading on 22x price-to-earnings ratio for a 10% three-year earnings per share compound annual growth rate, in its view.
"We raise our FY26-28 EPS estimates by 4-9% as we incorporate the upgraded margin guidance and the £200.0m share buyback programme, and increase our price target to 1,350p," said Berenberg.
Reporting by Iain Gilbert at Sharecast.com