Tomorrow afternoon this company, which is one of my favourite technology groups operating within the defence sector, will be holding its AGM in the City.
Ahead of the meeting, to approve the end April 2024 accounts, the group should be issuing an AGM Update together with a First Quarter Update – both of which I expect to be positive in their content.
Cohort, which has been on AIM since 2006, is the parent company of six innovative, agile and responsive businesses based in the UK, Germany and Portugal, providing a wide range of services and products for domestic and export customers in defence and related markets.
Based in Reading, Berkshire, the group employs over 1,300 core staff there and at its operating sites across the UK, Portugal, and Germany.
The group, which has business presence in Europe, Africa, Asia-Pacific, and the Americas, is split into two main segments - Communications and Intelligence; and Sensors and Effectors.
Through its various subsidiaries it is a provider of communication systems and technological services for defence, security, offshore and transport applications.
It designs, develops and manufactures information systems, intelligent transport systems, fire control solutions, vehicle-based surveillance systems, tracking and force protection systems, sonar systems and underwater communications systems.
The company also provides research and development, cyber security, systems engineering, software and electronic engineering services and solutions for its government and industry customers.
The group’s clientele includes the UK Ministry of Defence, Royal Norwegian Navy, and NATO.
The Communications and Intelligence division comprises the subsidiary businesses which provide electronic hardware and software solutions used for collecting, processing, and communicating information securely.
It also includes the provision of domain expertise, training, and support services.
The Sensors and Effectors division provides sensors, including sonar, radar and visual, for land and sea domains.
It also provides effectors for surface ships and land-based users to protect against sea, air and land-based threats including submarine, missile, and drone attacks.
Its markets include Combat systems, digital services, training and simulation, intelligent transport systems and others.
Two analysts follow the group closely and rate the shares as a Buy, with a 980p Price Objective being the highest aim.
Estimates for the current year to end-April 2025 are for £220.0m (£202.5m) sales, with adjusted pre-tax profits of £22.1m (£19.8m), generating earnings of 41.8p (42.7p), while increasing its dividend to 15.5p (14.8p) per share.
For the 2026 year expect £240m revenues, £25.0m profits, 47.4p earnings and a 16.3p dividend per share.
The group, which was £23.1m cash positive at the year-end, is currently valued at around £330m, with its shares trading at about 826p.
Hold very tightly.
(Profile 06.08.19 @ 446p set a Target Price of 607p*)
(Profile 14.04.23 @ 445p set a Target Price of 489.5p*)
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