James Fisher & Sons – Finals due this Thursday, shares wrongly priced at 513p, TP 585p
- Mark Watson-Mitchell
- 6 days ago
- 4 min read
Mark Watson-Mitchell
A year ago, on Thursday 20th March, I featured the shares of James Fisher & Sons (LON:FSJ) when they were trading at 323p, declaring that they were ‘a cracking portfolio must.’
They have since been up to 534p, a very useful 65% gain over the last year.
This £259m-capitalised group is a global company that provides services such as engineering, inspection, installation, commissioning, operations, maintenance, lifting and handling to the oil and gas, marine, renewable energy, shipping, defence, nuclear, ports and terminals, transportation, and infrastructure industries.
The group is #1 global provider of compressed air solutions for ‘bubble curtain’ projects in North America; #1 global provider of submarine rescue and saturation diving; it is a leading provider of commercial diving equipment; and a global provider of ship-to-ship transfer services.
Ahead of it announcing its 2025 Final Results this coming Thursday, 12th March, I am taking the view that the recent market falls present an ideal opportunity for investors to buy more, with the shares now at just 513p.
The Business
The group, which operates through three main segments – Energy, Defence and Maritime Transport, is strongly positioned across its core markets, with specialist capabilities aligned to global megatrends such as energy security, decarbonisation, localism, and digitalisation.
Its three Divisions hold market-leading positions that support the group’s growth strategy: Energy and Defence – aligned to future investment in the energy transition and marine defence security; and Maritime Transport – offering differentiated services in a high-barrier-to-entry market.
Energy – nearly half of group sales – aimed at driving offshore energy forward, it provides responsible energy and innovative renewable energy solutions, in the shift to a more sustainable future.
The group provides services to the energy and renewables markets including compressor services in the Oil and Gas markets and ‘bubble curtains’ for Offshore Wind, Inspection Repair and Maintenance, Commissioning, Cable & Blade maintenance and support into Renewables and Subsea & De-commissioning Services.
Its clients include BP, Chevron, Total, Shell, Schlumberger and EDF Energy amongst many others.
Defence – close to a fifth of sales – aimed at enabling mission critical success – it provides submarine rescue, special operations, and life support systems.
The main business lines within Defence are Submarine Rescue, Defence Diving, Special Forces Vehicles, Submarine Platforms, and Commercial Diving and Hyperbaric Systems.
Its clients include the US Navy, the Royal Australian Navy, Technip FMC, and Subsea7.
Maritime Transport – nearly 30% of group sales – aimed at shaping the future of maritime – it provides services for coastal shipping and ship-to-ship transfer.
Its clients include The Ministry of Defence, Total Energies, Phillips66, BP and Shell.
Full Year Trading Update
On Wednesday 29th January, the group announced a Trading Update for the year to end-December 2025 indicating that underlying operating profit is expected to be ahead of market expectations at approximately £28m, with an improved margin of around 7%, on revenue of approximately £395m, representing like-for-like growth of about 4%.
The company maintained its net debt to EBITDA within the target range of 1.0-1.5x, benefiting from supportive end-markets, particularly in Defence with recent contract wins enhancing FY26 visibility, and strong performance in Maritime Transport, despite some softness in oil and gas.
Management Comment
CEO Jean Vernet stated that:
"I am encouraged by our continued progress in 2025, where good second half delivery is anticipated to result in a full-year underlying operating profit performance ahead of market expectations.
We have made further progress across our key strategic priorities, bringing us closer to our medium-term targets and enabling the businesses to focus increasingly on their long-term growth opportunities.
Throughout the year, we followed our core principles of 'focus, simplify and deliver' resulting in a streamlined business portfolio, strengthened product base and international expansion.
Despite softness in oil and gas in the second half, overall market conditions remain largely supportive, and we have entered 2026 well-positioned to deliver further progress."
The Equity
There are some 50.4m shares in issue.
The larger holders include The Sir John Fisher Foundation (20.94%), Schroder Investment Management (13.37%), Odyssean Capital (7.81%), Aberforth Partners (7.26%), FIL Investment Advisors (6.12%), NFU Mutual Investment Services (5.38%), Baillie Gifford (4.78%), Invesco Asset Management (3.81%), Threadneedle Asset Management (3.62%) and Harwood Capital (3.07%).
Broker Views
Some six analysts closely follow the group, all of whom call the shares out as a Buy, with the consensus average Target Price of 534p, the Lowest at 466p and the Highest at 615p.
At Singer Capital Markets, analysts Caroline de La Soujeole and Henry Carver, have a Target Price of 585p.
Their estimates for 2025 are for revenues to have dipped to £395.9m (£437.7m), but with adjusted pre-tax profits having risen to £14.3m (£11.9m), with earnings of 19.5p (10.5p) per share.
For the current year, they see sales of £417.0m, with £17.6m profits and 24.0p of earnings.
The 2027 year sees them having pencilled in £437.7m turnover, £21.7m of profits and earnings of 29.7p per share.
They note that:
“After a period of retrenchment which has resulted in a significant reshaping of the portfolio, we think James Fisher is now entering a new chapter with the focus turning to profitable and sustainable growth.
We see a credible path to mid-single digit organic growth, supported by stronger commercial execution and structural tailwinds.
Management’s 10% operating margin target appears achievable—two divisions already operate in double digits, and Defence should follow as improvements bed in.
Rising margins and disciplined capital allocation should support value creation, driving ROCE.
Our view is that transformation momentum is building, yet the full benefits are not reflected in market expectations.”
In My View
The group’s Management is confident in delivering further progress, which is expected to be seasonally weighted towards the second half.
As the analyst’s state - James Fisher is a unique investment opportunity in terms of its breadth of activities in marine services (energy, transport, defence) with no direct quoted peer.
I take the view that the group is very definitely now on a progressive journey and that its shares at 513p are wrongly priced in the light of its potential.
(Profile 11.02.25 @ 345p set a Target Price of 410p*)
(Profile 24.02.26 @ 498p set a Target Price of 580p)
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