(News Bulletin 247) – Jefferies on Monday raised its advice on Thales from ‘hold’ to ‘buy’ with a price target revised upwards from 140 to 160 euros, representing an upside potential of 18%.
In a note released in the morning, the teams of the American design office welcome the shift towards cybersecurity made by the defense electronics group.
According to its analysts, the French group now presents a ‘more attractive’ profile after the completion of two acquisitions which will enable it to accelerate its growth.
Jefferies also highlights a momentum that is accelerating at the level of the Rafale, to which it is very exposed, with the receipt of 18 new orders from Indonesia this summer, not counting the purchase options on 18 additional aircraft , before the 26 units to be delivered to India in 2024.
The research firm is also relieved by the materialization of factors that penalized the title, such as the loss of the Telesat contract, or the pure and simple disappearance of reasons for concern, such as a possible acquisition of Atos.
He also notes that the group’s share buyback program is now well underway, with an end that is not scheduled before March 2024.
All these elements lead him to anticipate a ‘significant’ improvement in the company’s free cash flow (FCF) over the period 2023-2025.
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