Deutsche Bank has lifted its outlook on defence contractor QinetiQ Group PLC (LSE:QQ.) following yesterday’s earnings and sales growth beat.
The global defence and security company saw its operating profit rise by 20% to £215.2 million in the 12 months ended March 31, with firm-wide order intake remaining stable at £1.74 billion with a £2.87 billion funded order backlog.
In response, Deutsche analysts upgraded their financial year 2025 EBITA (earnings before interest, tax and amortisation) forecast by 2% and earnings per share (EPS) forecast by 5%.
The bank believes that QinetiQ’s capabilities position it well to benefit from increased defence spending and the shift towards higher technology platforms and solutions, which will likely involve faster product cycles and broader integration testing.
As such, Deutsche has raised its price target by approximately 9% to 470p. Shares are currently changing hands at 408p.
“QinetiQ is one of our preferred stocks within our UK Capital Goods coverage,” said analysts, adding: “We continue to believe the quality, strength and importance of this division is being overlooked by the market.”