Hunting – Trading Update indicates good Order Book and Tender pipeline, with big subsea emphasis, shares 401p, new TP 460p

Mark Watson-Mitchell
3 days ago
4 min read

Mark Watson-Mitchell - 15.01.2026

The 2025 Full Year Trading Statement issued by Hunting (LON:HTG), the £600m-capitalised global precision engineering group, covered the period to end-December last.

Last July, I stated that the group’s shares were undervalued at 339p, since when they have risen over 20%.

I believe that the group has the potential for significant growth in its main operating divisions, and that its shares, now at 401p, are an attractive investment.

The Update

The Group indicated EBITDA of approximately $135m, a 7% increase year-on-year, with an improved EBITDA margin of around 13%.

The company ended the year with a sales order book of $350m and a short-term tender pipeline exceeding $1bn, including a strong subsea pipeline of $300m.

Cash reserves stood at $59-$61m after significant outflows for acquisitions and shareholder returns, including $33.5m of a $60m share buyback completed.

For 2026, EBITDA is projected between $145m and $155m, with capital expenditure of $40-$50m and free cash flow expected to be 50% of EBITDA.

The company also raised its 2030 Subsea Technologies revenue ambition to $470m, with a target of $230m revenue and $50m EBITDA by 2028 for that segment.

The Business

Established in 1874, Hunting is a global, precision engineering group that provides precision-manufactured equipment and premium services.

The Company maintains a corporate office in Houston and is headquartered in London.

As well as the United Kingdom, the Company has operations in China, India, Indonesia, Mexico, Saudi Arabia, Singapore, United Arab Emirates and the USA.

The Group has five operating segments: Hunting Titan; North America; Subsea Technologies; Europe, Middle East and Africa; and Asia Pacific.

It is based on five product groups: OCTG; Perforating Systems; Subsea; Advanced Manufacturing; and Other Manufacturing.

Management Comment

CEO Jim Johnson stated that:

"2025 has seen further delivery of our Hunting 2030 strategy and we are well placed to deliver another year of growth as we enter 2026, despite wider market headwinds.

During the year, we successfully acquired and integrated the Flexible Engineered Solutions and the Organic Oil Recovery businesses while completing the divestment of our interest in Rival Downhole Tools, allowing us to recycle capital into faster growth and higher return businesses.

With our revised capital allocation priorities announced in July 2025, our shareholder returns increased during the year whilst retaining our financial flexibility to pursue earnings-enhancing acquisitions.

This is due to our strong focus on balance sheet efficiency and strength.

Our Subsea Technologies operating segment is poised for growth in the medium-term, a testament to our strategy to pivot our earnings to this sub-sector of the energy industry back in 2019.

The Spring and FES businesses are seeing strong opportunities within the SURF sub-sector of the industry, while the OOR business is seeing tremendous levels of interest in South America, the Middle East and Asia Pacific.

Our integrated and enlarged subsea offering means that we can now offer customers a more comprehensive range of products.

As a result of this, we are today raising our guidance for Subsea Technologies revenue, as part of our Hunting 2030 growth plan, from c.$250 million p.a. to c.$470 million p.a. by the end of the decade, a figure we expect to deliver through further M&A activity in addition to a strong contribution from the OOR business."

Brokers Views

Analyst Daniel Slater, at Zeus Capital, rates the group’s shares as a Buy, with a 450p a share valuation.

Commenting upon the Trading Update, Slater suggested that Hunting had reported full-year EBITDA performance that was ‘in-line’ with expectations, while noting that the group had net cash ahead of guidance, rounding out a year of further growth for the company.

Slater expects growth to continue in 2026, especially as the company continues to focus on building out its Subsea business.

For the year to end-December 2025 he estimates that the group’s sales will be around $1,056.8m ($1,048.9m), while adjusted pre-tax profits could show out at $86.3m ($75.6m), generating earnings of 35.4c (31.4c), with a dividend of 13.0c (11.5c) per share.

For the year now underway, he looks for $1,128.4m sales, $97.8m profits, with 30.3c earnings and a 14.7c per share dividend.

At Berenberg, analyst Richard Dawson retained his ‘Buy’ recommendation with a Target Price of 450p.

Noting that Hunting is pivoting into higher revenues, he too sees that a more positive outlook for its subsea technologies division, which will help it to deliver further growth.

“Cash generation was particularly strong across the fourth quarter, leaving the year-end net cash position above guidance and the balance sheet in a strong position to deliver on the company’s shareholder returns framework and further M&A.

We think the segment could deliver a high-teens revenue compound annual growth rate to 2028, with the contributions typically high-margin and more resilient.”

My View

Having closely followed this group for some decades, my confidence in its Management is not shaken.

The group’s prospects look excellent, and I believe that its shares, now 401p, will soon be breaking above the broker’s Target Prices.

I now set a new Target Price at 460p.