Pennant has reported in-line full-year results but, more importantly, has completed a strategic repositioning to accelerate growth in its Software & Technical Services businesses. These units should generate more predictable revenue, higher gross and net margins, and improved cash conversion. To this end, the Group has just released an updated version of its market-leading Auxilium product lifecycle management software solution; Q1 user numbers are on target. Our forecasts for 2025E are aligned ...
Pennant has issued a positive update on the GenFly contract with the UK Ministry of Defence (MOD). The MOD announced on 23 October 2024 its intention to contract with Pennant for a wide-ranging technology upgrade to the RAF’s GenFly training systems. The Group has now received an “Invitation to Negotiate” (ITN) to commence contract negotiations. Pennant says that the anticipated contract value is confirmed at c.£4.9m, subject to agreeing final terms. It is expected to commence in Q3 2025E. Separ...
The wake-up call of the Munich summit will force European countries to assume full responsibility for their own defence. For the groups in our coverage, this should lead to a 2024-2030e CAGR for the addressable market of 31.5% (baseline scenario) vs 10.5% previously as well as a financial support that should help to improve FCF. We have revised the target prices of defence stocks upward by an average of 42% and think that additional upside of 20% is within reach. Hensoldt upgraded to Outperform ...
Le wake up call de la conférence de Munich va forcer les pays européens à assumer seuls leur défense. Pour notre couverture, cela se traduira par un TMVA 2024-30 du marché adressable de 31.5% (base case) vs 10.5% précédemment ainsi qu’un support financier qui améliorera le FCF. Nous relevons de 42% en moyenne les OC des valeurs exposées Défense et pensons qu’une appréciation des cours de 20% supplémentaire est à portée de main. Hensoldt relevé à Surperformance et BAE Systems abaissé à Sous-perfo...
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