Berenberg slashes QinetiQ price target, reiterates 'buy' rating
Berenberg slashed its price target on on Wednesday to 500p from 610p to reflect lowered estimates, but reiterated its 'buy' rating.
The bank said QinetiQ has been affected year-to-date by a slowdown in activity in its UK Intelligence, and US federal IT and product businesses.
"The net effect of new guidance issued following the group's recent profit warning is a circa 10% cut to FY 2026 earnings per share forecast, on our estimates," it said.
Berenberg noted that the shares have fallen 25% since the announcement and trade on 12x 2025 price-to-earnings for a 15% three-year EPS compound annual growth rate, which is a 35% discount to UK defence peers.
"It will take time for confidence to be restored, although the improved UK defence budget outlook and more focused US business help underpin our mid-term estimates," it said.
At 1110 GMT, the shares were down 3.8% at 380.38p.
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