Goldman Sachs has turned more bullish on blue chip defence contractor BAE Systems (LON:BA), upgrading the stock to its ‘Conviction Buy’ list after recent underperformance.
In early afternoon trading, the FTSE 100-listed firm’s shares were 2.3%, or 13.5p higher at 594p.
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In a note to clients, Goldman’s analysts reiterated their ‘buy’ rating on BAE shares while adding the stock to its influential list.
They noted that BAE shares were now trading at a wider-than-usual discount to its US peers having underperformed the FTSE 100 recently.
The analysts added: "We expect program growth, as well as a new Typhoon (combat aircraft) order from Saudi Arabia, to cement the outlook for 2019/2020.”