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BAE Systems share price outperforms as analysts hike valuation

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Shares in BAE Systems (LON:BA) have climbed into positive territory in today’s session, following a move by JPMorgan to hike its price target on the stock. WebFG News reports that the analysts expect major news flow from the British defence contractor in the coming months.

As of 14:10 BST, BAE Systems’ share price had added 0.37 percent to 648.60p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.65 percent in the red at 7,826.13 points. The group’s shares have added a little over one percent to their value over the past year, as compared with about a 4.4-percent gain in the Footsie.

JPMorgan hikes valuation on BAE Systems

JPMorgan, which has an ‘underweight’ rating on BAE Systems, lifted its price target on the stock from 550p to 600p today, noting that the group might win large new contracts in the US, the Middle East and Australia.

“Mostly these would impact sales in the 2020s but clearly contract wins are good news,” the broker elaborated, as quoted by WebFG News, adding, however, that they believed that the rally in BAE Systems’ share price in the past three months “has to some extent discounted the potential wins”.

The comments come after the British defence contractor recently reiterated its full-year outlook, with underlying earnings per share still expected to be in line with 2017.

Other analysts on British defence contractor

The 17 analysts offering 12-month price targets for BAE Systems for the Financial Times have a median target of 690.00p on the shares, with a high estimate of 805.00p and a low estimate of 480.00p. As of May 18, the consensus forecast amongst 21 polled investment analysts covering the defence contractor has it that the company will outperform the market.  

As of 14:55 BST, Wednesday, 23 May, BAE Systems plc share price is 648.40p.

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