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(Sharecast News) - Berenberg trimmed its price target on James Fisher from 850pto 835p on Tuesday, but kept its 'buy' rating on the stock after the engineering group posted a strongerthanexpected first half performance and reiterated its fullyear guidance.
The German bank said H1 adjusted underlying earnings had come in 9% ahead of its forecast, driven by firm momentum in its defence and maritime transport divisions, which more than offset ongoing weakness in energy endmarkets. Defence revenues jumped 43% yearonyear, pushing the unit's EBITA margin up to 9.9%, while tankship utilisation in maritime transport reached 92%. Group revenues rose 2% to £196m, beating Berenberg's estimate, while adjusted EBITA of £14.2m was also ahead of expectations.
However, higher lease costs for four new tankships and a softer outlook for the energy division prompted the broker to trim outeryear forecasts, with Berenberg cutting its FY27 adjusted EBITA estimate by 1.1% and reducing adjusted earnings per share across all years by 10% to 14% due to increased finance charges.
Berenberg said James Fisher's defence unit's growing order book, which now sits at around £390m, provided strong visibility into H2 and FY27, while maritime transport continued to show margin progression. Energy activity remained challenged, as expected, with reduced welltest work in the UK North Sea and mixed renewables demand.
Looking ahead, Berenberg said it still sees re-rating potential as James Fisher increases exposure to highergrowth, higher-margin markets, but the modest forecast reductions lowered its enterprise value-to-EBITDAbased 12month target price to 835p, implying 83% upside.
Reporting by Iain Gilbert at Sharecast.com
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