THALES : UBS raises its recommendation and price target
August 02, 2024 at 06:10 am EDT
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UBS has upgraded its opinion on Thales to Neutral (from Sell) and raised its target price to E150 (from E125).
The challenges we have highlighted are increasingly well understood, and growth in the defense business is potentially underestimated', says UBS.
Thales has confirmed its targets for 2024, with a tighter range, targeting a book-to-bill ratio of over one, organic sales growth of between +5 and +6%, and an EBIT margin of 11.7 to 11.8%.
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Thales is one of the European leaders in manufacturing and marketing of electronic equipment and systems for the defense and security, aerospace, and transportation sectors. Net sales break down by product group as follows:
- defense and security systems (53.4%): C4I defense and security systems (control and monitoring systems, communication, protection, cyber-security, and other systems), defense mission systems, naval systems, electronic war systems, drones, air operation systems (air defense, air surveillance), ground defense systems and missiles;
- aerospace systems (28.4%): avionics equipment (cockpit, cabin multimedia, and simulation equipment), space systems (satellites, payloads, etc.);
- digital identification and security solutions (18.2%).
Besides, the group owns a 35% stake in Naval Group (manufacture of naval equipment for defense and nuclear energy sectors).
Net sales are distributed geographically as follows: France (29.5%), the United Kingdom (6.6%), Europe (24.8%), the United States and Canada (14%), Asia (9.4%), Near and Middle East (6%), Australia and New Zealand (4.4%) and other (5.3%).
THALES 
