Chemring rallies on Barclays upgrade
Barclays upgraded its stance on Chemring on Monday to ‘overweight’ from ‘equalweight’ and hiked the price target to 380p from 250p, saying it’s the purest-play cyber exposure in its UK defence coverage.
It noted that Roke Manor currently represents 18% of FY20 revenues, 80% of which are cyber security versus the EU defence average of less than 10%, providing high end active cyber, cryptography, information warfare and consultancy.
"In our view, the business is well positioned competitively and it generates market-leading margins (around 25% versus peers less than 15%)," Barclays said. "We believe Chemring is the most attractive way to play the cyber security growth theme in the UK."
At 1140 GMT, the shares were up 3.2% at 309.50p.