Broker tips: Cohort, On the Beach

25th Sep 2026 13:47

(Sharecast News) - Analysts at Berenberg said on Friday that Cohort's AGM update on 24 September was reassuring, highlighting continued order‑intake momentum and improving margins across the group's businesses.

Trading in the first months of FY27 was in line with expectations, said Berenberg, allowing the board to reiterate full‑year guidance, while the firm's order book reached a record £700m, providing around 90% cover for FY27 consensus revenue.

Berenberg said Cohort's M&A pipeline remained active, supported by recently expanded bank facilities, though it expected the board to stay disciplined on valuation multiples.

The German bank left its FY27 forecasts unchanged but lifted FY28 and FY29 adjusted earnings per share estimates by 3% to 4%, reiterating its 'buy' rating and 1,630p price target.

Recent contract wins included a €140m ELAC deal with Saab and work on Poland's Orca Submarine Programme, alongside an Italian award, which Berenberg said underscored ELAC's strong technology platform and pointed to further opportunities.

Berenberg noted that seller valuations in the wider market remain elevated-particularly in the drone segment - but not unreasonable elsewhere. It also said Cohort continued to expect an H2 profit weighting in FY27, consistent with prior guidance and FY26 seasonality, and that outer‑year revenue and margin visibility had improved.

Berenberg added that Cohort's shares trade on 17.6x FY27 earnings, falling to 15.5x in FY28, with an FY28 enterprise value-to-underlying earnings multiple of 10x, a 6% free‑cash‑flow yield and a 1.9% dividend yield.

Canaccord Genuity cut its target price for On the Beach from 240p to 220p on Friday after the group's FY26 trading update, saying reduced FY27 guidance and a still‑fragile consumer backdrop limited upside despite a stronger finish to the year.

On the Beach reported improving booking momentum through the second half, delivering 9% bookings growth and 6% totl transaction value growth for FY26. Adjusted pre‑tax profits were expected at £22 to £23m, ahead of the £20m consensus. However, initial FY27 pre-tax profit guidance of £28 to £35m represents roughly a 10% downgrade at the midpoint, prompting Canaccord to lower its estimates.

Canaccord said the outlook reflected both a challenging macro environment and additional platform investment that would weigh on margins.

The Canadian bank upgraded its FY26 pre-tax profit forecast by around 10%, but made broad cuts to FY27 and FY28, trimming FY27 revenue by 8% and pre-tax profits by 18.5%, and reducing FY28 revenue and pre-tax profits by 11% and 25%, respectively.

While booking trends strengthened late in FY26 - with summer 2026 bookings now 4% ahead of last year and the past eight weeks up 17% - Canaccord said it remained unclear how much of the improvement reflected genuine demand rather than a temporary shift in booking patterns following Middle East disruption. With shorter booking windows, likely airline price inflation and continued pressure on UK consumers, visibility into FY27 remained limited.

OTB now trades on 11.6x Canaccord's revised FY27 earnings estimate, leading the broker to reiterate its 'buy' rating but note that the scope for further re‑rating had narrowed.