Berenberg raises target price on James Fisher

16th Jun 2026 07:39

(Sharecast News) - Analysts at Berenberg lifted their target price on James Fisher from 790p to 850p on Tuesday after attending the group's capital markets day earlier in June, saying it came away "very encouraged" about the growth prospects for its defence division.

Berenberg said the event highlighted James Fisher's differentiated technologies, strong market positions and growing confidence among senior management, with order‑intake momentum expected to build over the next 12-18 months. Forecasts for FY26-FY28 were left unchanged, while FY29 estimates were introduced.

The German bank said James Fisher's defence unit offers "significant" growth opportunities, particularly in Tactical Delivery Vehicles and its new Stealth Multi‑role rebreather, which together represent a serviceable obtainable market of around £3.2bn, compared with FY25 revenue of £100m. TDVs currently face no direct competition, and Berenberg said a blue‑sky scenario for these two products alone could present 100% upside to its FY29 adjusted underlying earnings forecast of £50m.

Berenberg also sees further margin upside within the defence unit, noting the division's high operational leverage and a growing base of recurring, higher‑margin service revenue from commercial diving and rescue‑submarine contracts. Its new FY29 EBITA‑margin estimate stands at 11.5%, but the broker believes mid‑teens margins to be achievable over the medium term - above the company's current 10% target.

At group level, Berenberg said all three divisions now have clear plans to lift margins into the mid‑to‑high‑teens, while central costs have stabilised at 3.5% to 4% of revenue following recent investment in personnel. As a result, it views the group's 10% adjusted‑EBITA margin target as "very achievable" and likely to be met ahead of FY28.

Berenberg, which reiterated its 'buy' rating on the stock, added that James Fisher's valuation remains "compelling", with the shares trading on 19x CY26 earnings, falling to 15x in CY27, and a CY27 enterprise value to EBITDA multiple of 5.1x. With a double‑digit free‑cash‑flow yield and scope for dividend payments to resume, Berenberg said the stock offers around 70% upside to its new target.

Reporting by Iain Gilbert at Sharecast.com