Babcock Moves Higher As Shares (BAB) Gain New Bull: Target Suggests More To Come

Shares of Babcock International Group (LON: BAB) are attracting plenty of attention today, fueled by positive analyst coverage, strategic corporate actions, and no news of a ceasefire in Russia's war in Ukraine in Friday's meeting.

The company's stock is benefiting from growing confidence in its ongoing turnaround efforts, and bullish sentiment in the defence sector, as evidenced by recent financial institution upgrades and a substantial share buyback program.

Babcock's share price performance has been a huge outperformer this year, up 106% YTD, and consistently trading above its 200-day moving average, reflecting increasing investor confidence. A new bullish outlook today has also been well received, with the shares up a further 4.7% into the afternoon session.

RBC Capital analyst Ben Pfannes-Varrow initiated coverage of Babcock with an Outperform rating and a price target of 1,200p. The firm's analysis suggests that the company's current valuation discount compared to the broader European defense sector does not adequately reflect the progress and potential of its turnaround strategy.

In July 2025, Babcock initiated a £200 million share buyback program, managed by Jefferies International Ltd and JP Morgan Securities PLC. This program, expected to run until March 31, 2026, underscores the company's commitment to optimizing its capital structure and delivering enhanced value to shareholders. The buyback program is a clear signal of management's belief in the company's intrinsic value and future prospects.

The convergence of positive analyst coverage, strategic share buybacks, and consistent share price performance above key moving averages paints a picture of a company successfully executing its turnaround strategy. The markets are responding favorably to these developments, recognizing the potential for further appreciation in Babcock's stock. As Babcock continues to demonstrate its ability to deliver on its strategic objectives, investor confidence is likely to remain strong.