Filtronic – AGM Trading Update due next week, I am setting a new ‘near-term’ Target Price of 165p, shares now 130p

Mark Watson-Mitchell – 19.10.2025

I am looking forward to a bullish Trading Update being issued by Filtronic (LON:FTC) just ahead of its AGM being held on Thursday of next week, 30^th October, which will create even more interest in the group’s shares.

The Sedgefield-based £292m-capitalised group is on the leading edge of advanced micro electronics, in solving complex RF, microwave and mmWave challenges, Filtronic specialises in the design and manufacture of mission critical communication networks.

Opening Frontiers

The group states that the convergence of space, aerospace and defence, and communications is accelerating — driven by the need for high-frequency, secure, and resilient communications infrastructure and Filtronic considers that it is well-positioned to capitalise on this significant medium-term market opportunity.

The company reckons that the key growth drivers for the sector include accelerating satellite launches, global 5G base station rollouts, rising military expenditure, and a shift toward higher spectrum frequencies and advanced component technologies such as GaN.

(GaN refers to gallium nitride, a semiconductor material used in electronics like fast chargers, it is favoured in electronics for its efficiency and ability to handle higher temperatures than silicon.)

With a strong foundation in high-frequency connectivity solutions and a sharpened organisational structure, Filtronic has been investing in go-to-market strategies and infrastructure to expand its customer orderbook and enhance long-term revenue visibility.

Filtronic considers that it excels across surface, sky and space, delivering high-performance, high-frequency, high-power, high-reliability RF solutions with exceptional yield.

Over the years, the company has become renowned for terrestrial performance and reliability, whilst pushing boundaries in non-terrestrial applications.

It provides customised, high-performance technologies to its core markets of telecommunications infrastructure, critical communications, space and aerospace & defence.

Working with some of the world’s leading technology leaders, Filtronic designs and manufactures a range of solutions from 300MHz to 175GHz into adjacent markets such as trackside to train, high frequency trading, test and measurement and private networks, where its core competencies provide its clients with a competitive edge.

It supplies trusted, scalable RF components and subsystems for Low Earth Orbit satellites, High Altitude Pseudo Satellites, ground stations and payloads - with customers like SpaceX relying on its mission-critical amplifiers and transceivers.

Its innovations include the first 40Gbps stratosphere-to-ground link and the first commercial E-band earth station antenna, transforming 5G latency and throughput.

In defence, it enables secure sensing, protection and communication through RF, microwave and mmWave technologies.

The company collaborates closely with clients, delivering compliant, reliable products as an integral supply chain partner - recognised with awards for outstanding contribution.

For telecommunications, it provides ultra-high-capacity, highly linear mmWave transceivers and amplifiers, enabling 4G/5G Xhaul with superior SWaP, power and bandwidth.

Trusted by two of the world’s top three OEMs, its solutions reduce time to market, improve competitiveness and perform in the most demanding networks worldwide.

The group is progressing on a move to a new custom-built facility in Sedgefield, looking for completion in H1 FY2026, doubling the group's UK manufacturing footprint, to meet growing demand for the group's products.

Expanding Space, Aerospace and Defence Engagement

The company reports record order intake in the Space sector, including a landmark agreement with SpaceX, and new contract awards with Viasat, European Space Agency and Airbus.

It is also strengthening its position in the Defence sector, demonstrated by the recent airborne radar application contract with Leonardo and progress made with the QinetiQ and BAE Maritime Systems programmes.

Outlook

On presenting the 2025 results, CEO Nat Edington stated that:

"FY2025 has been a transformative year for Filtronic, showcasing the successful execution of our growth strategy.

Our record revenue growth and landmark wins in the Space and Defence sectors reflect the trust placed in us by global players and that our technology is meeting real world demand.

As we enter FY2026, we are confident in our trajectory, with a strong order book, healthy cash position, and a strengthened leadership team in place.

The transition to GaN technology, expansion into higher-frequency bands, and our move to a new, larger manufacturing facility will enable us to scale effectively and capitalise on the significant opportunities ahead."

The group has started its FY2026 with good commercial momentum, a robust order book, and an organisation capable of scaling further.

In mid-July, the group announced a new contract award to supply high-performance modules for an electronic sensor system for £13.4m, awarded for the complex manufacture and testing of critical components.

In late August, the company reported that it had secured its largest single order to date, a £47.3m ($62.5m) contract with SpaceX for its next-generation gallium nitride (GaN) E-band product, which will deliver more than double the output power of the existing gallium arsenide product line.

Early trading in the year, to end-May 2026, has been encouraging, with continued demand from space and aerospace and defence customers and a growing pipeline of opportunities.

It is focused on broadening the customer base, completing key technology developments and relocating its state-of-the-art manufacturing site in Sedgefield to a new facility at the same science and technology park.

Edington concluded that:

“The medium-term outlook is positive, and I am confident in our ability to build a sustainable high-growth, high performance business that plays a critical role in the future of global communications infrastructure.”

Analyst Views

The analyst team of James Musker, Harold Evans and Roddy Davidson, at Singer Capital Markets, recently initiated coverage with a Buy rating on the group’s shares, while putting out a 205p Target Price.

Their current year estimates, to end-May 2026, are for revenues of £56.7m (£56.3m), with a fall-back in adjusted pre-tax profits to £8.6m (£15.1m), slashing earnings to 3.7p (6.8p) per share.

For the 2027 year, they go for £65.6m sales, £11.1m profits and 4.8p per share of earnings.

At Cavendish Capital Markets, analysts Edward Stacey and Kimberley Carstens have a Buy out on the stock, with a 194p a share Target Price.

They see the 2026 year with £54.0m revenues, £8.3m profits and 3.2p earnings.

For 2027 they have £60.0m revenues and £10.0m profits, with 3.9p earnings per share.

My View

The orders are only just beginning to build up now, ahead of the new facility getting underway next year.

So, it will pay to take a ‘longer-term’ view with this group, and its profit prospects.

The group’s shares, which in mid-July this year were up to 175p, are now trading at 130p after ‘low-news’ periods of profit-taking.

Ahead of the AGM, I will now set a 'near-term' Target Price of 165p.

(Profile 04.02.22 @ 11.6p set a Target Price of 14.5p*)

(Profile 04.01.24 @ 21p set a Target Price of 24p*)

(Profile 26.06.24 @ 67p set a Target Price of 80p*)

(Profile 10.02.25 @ 103p set a Target Price of 150p*)

(Profile 19.10.25 @ 130p sets a new Target Price of 165p)

Asterisks * denote that Target Prices have been achieved since Profile publication.