From Morningstar: 2025-05-21 07:03:00

BAE Systems has had its fair value estimate raised to £22.50 due to a stronger growth outlook and European defense integration. The UK’s reentry into EU-funded programs via the EDIS framework marks a turning point. The air division CAGR has been revised to 7%, with potential growth in European missile markets and electronic systems. Additionally, platform systems growth is expected to reach 8%.

Through MBDA, BAE Systems is well positioned to capitalize on the European missile market’s growth. The market is projected to outpace the broader defense sector as Europe increases investments in advanced missiles for strategic autonomy. This aligns with Europe’s accelerating demand for tactical communications, C4ISR, and electronic warfare upgrades, reflecting NATO modernization and UAV integration.

The European missile market boost is expected to drive growth in BAE’s electronic systems, with a forecasted 9.0% CAGR. The new space & mission systems unit, leveraging the Ball Aerospace acquisition, is projected to grow at an 11% CAGR. BAE’s platform systems growth is also set to increase to 8%, reflecting new export momentum and tracked vehicle replacements across Europe.



Read more at Morningstar: BAE Systems: Fair Value Estimate Increased on…