(BSP) BAE Systems - Overview
Combat Vehicles, Naval Ships, Fighter Jets, Submarines, Cyber Services
Dividends
| Dividend Yield | 1.90% |
| Yield on Cost 5y | 9.73% |
| Yield CAGR 5y | 8.94% |
| Payout Consistency | 96.0% |
| Payout Ratio | 50.7% |
| Risk 5d forecast | |
|---|---|
| Volatility | 32.4% |
| Relative Tail Risk | -2.62% |
| Reward TTM | |
|---|---|
| Sharpe Ratio | 1.43 |
| Alpha | 61.04 |
| Character TTM | |
|---|---|
| Beta | -0.075 |
| Beta Downside | -0.112 |
| Drawdowns 3y | |
|---|---|
| Max DD | 23.20% |
| CAGR/Max DD | 1.56 |
Description: BSP BAE Systems January 29, 2026
BAE Systems plc (XETRA:BSP) is a global defence, aerospace and security contractor operating across the United States, United Kingdom, Middle East, Australia, Japan, Europe and other markets. It is organised into five business segments – Electronic Systems, Platforms & Services, Air, Maritime and Cyber & Intelligence – each delivering a mix of hardware (e.g., combat vehicles, submarines, aircraft) and high-tech services (e.g., electronic-warfare suites, cyber-security for national-security customers).
Recent performance metrics (FY 2025, released Nov 2025) show revenue of £29.3 bn (up 3.2 % YoY), underlying earnings per share of 73 p and an order-backlog of £45 bn, of which roughly 60 % is attributable to the United States and United Kingdom defence ministries. The company’s free-cash-flow conversion improved to 18 % of revenue, reflecting tighter capital-expenditure discipline in its Maritime and Platforms & Services divisions.
Key macro drivers remain robust: the U.S. defence budget is projected to rise ~4 % in FY 2026, bolstered by increased spending on next-generation air and cyber capabilities; the UK has committed to a 2.5 % annual rise in defence outlays, supporting BAE’s domestic ship-building and electronic-systems programmes. Additionally, the broader aerospace-defence sector benefits from a 1.8 % CAGR in global defence procurement over the 2023-2028 horizon, driven by heightened geopolitical risk and modernisation cycles.
For a deeper dive into BAE’s valuation and scenario analysis, check the ValueRay research page.
Piotroski VR‑10 (Strict, 0-10) 8.5
| Net Income: 3.82b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.12 > 0.02 and ΔFCF/TA 1.62 > 1.0 |
| NWC/Revenue: -0.92% < 20% (prev 3.10%; Δ -4.02% < -1%) |
| CFO/TA 0.17 > 3% & CFO 6.28b > Net Income 3.82b |
| Net Debt (7.28b) to EBITDA (7.05b): 1.03 < 3 |
| Current Ratio: 0.96 > 1.5 & < 3 |
| Outstanding Shares: last quarter (3.03b) vs 12m ago -1.56% < -2% |
| Gross Margin: 54.87% > 18% (prev 0.49%; Δ 5438 % > 0.5%) |
| Asset Turnover: 155.2% > 50% (prev 72.72%; Δ 82.48% > 0%) |
| Interest Coverage Ratio: 6.82 > 6 (EBITDA TTM 7.05b / Interest Expense TTM 778.0m) |
Altman Z'' 1.73
| A: -0.01 (Total Current Assets 11.16b - Total Current Liabilities 11.63b) / Total Assets 36.00b |
| B: 0.11 (Retained Earnings 3.86b / Total Assets 36.00b) |
| C: 0.16 (EBIT TTM 5.31b / Avg Total Assets 33.48b) |
| D: 0.38 (Book Value of Equity 9.59b / Total Liabilities 24.99b) |
| Altman-Z'' Score: 1.73 = BBB |
Beneish M -2.66
| DSRI: 0.49 (Receivables 7.17b/6.38b, Revenue 51.96b/22.52b) |
| GMI: 0.89 (GM 54.87% / 48.72%) |
| AQI: 1.03 (AQ_t 0.51 / AQ_t-1 0.50) |
| SGI: 2.31 (Revenue 51.96b / 22.52b) |
| TATA: -0.07 (NI 3.82b - CFO 6.28b) / TA 36.00b) |
| Beneish M-Score: -2.66 (Cap -4..+1) = A |
What is the price of BSP shares?
Over the past week, the price has changed by -2.27%, over one month by +18.43%, over three months by +7.81% and over the past year by +59.07%.
Is BSP a buy, sell or hold?
What are the forecasts/targets for the BSP price?
| Issuer | Target | Up/Down from current |
|---|---|---|
| Wallstreet Target Price | - | - |
| Analysts Target Price | - | - |
| ValueRay Target Price | 27.3 | 17.7% |
BSP Fundamental Data Overview January 27, 2026
Market Cap GBP = 59.60b (68.79b EUR * 0.8664 EUR.GBP)
P/E Trailing = 31.44
P/E Forward = 23.5849
P/S = 2.5101
P/B = 5.4654
P/EG = 4.0846
Revenue TTM = 51.96b GBP
EBIT TTM = 5.31b GBP
EBITDA TTM = 7.05b GBP
Long Term Debt = 7.05b GBP (from longTermDebt, last quarter)
Short Term Debt = 814.0m GBP (from shortTermDebt, last quarter)
Debt = 9.43b GBP (from shortLongTermDebtTotal, last quarter)
Net Debt = 7.28b GBP (from netDebt column, last quarter)
Enterprise Value = 66.88b GBP (59.60b + Debt 9.43b - CCE 2.15b)
Interest Coverage Ratio = 6.82 (Ebit TTM 5.31b / Interest Expense TTM 778.0m)
EV/FCF = 15.77x (Enterprise Value 66.88b / FCF TTM 4.24b)
FCF Yield = 6.34% (FCF TTM 4.24b / Enterprise Value 66.88b)
FCF Margin = 8.16% (FCF TTM 4.24b / Revenue TTM 51.96b)
Net Margin = 7.35% (Net Income TTM 3.82b / Revenue TTM 51.96b)
Gross Margin = 54.87% ((Revenue TTM 51.96b - Cost of Revenue TTM 23.45b) / Revenue TTM)
Gross Margin QoQ = 8.44% (prev 100.0%)
Tobins Q-Ratio = 1.86 (Enterprise Value 66.88b / Total Assets 36.00b)
Interest Expense / Debt = 2.37% (Interest Expense 223.0m / Debt 9.43b)
Taxrate = 14.97% (178.0m / 1.19b)
NOPAT = 4.51b (EBIT 5.31b * (1 - 14.97%))
Current Ratio = 0.96 (Total Current Assets 11.16b / Total Current Liabilities 11.63b)
Debt / Equity = 0.87 (Debt 9.43b / totalStockholderEquity, last quarter 10.84b)
Debt / EBITDA = 1.03 (Net Debt 7.28b / EBITDA 7.05b)
Debt / FCF = 1.71 (Net Debt 7.28b / FCF TTM 4.24b)
Total Stockholder Equity = 11.07b (last 4 quarters mean from totalStockholderEquity)
RoA = 11.40% (Net Income 3.82b / Total Assets 36.00b)
RoE = 34.49% (Net Income TTM 3.82b / Total Stockholder Equity 11.07b)
RoCE = 29.29% (EBIT 5.31b / Capital Employed (Equity 11.07b + L.T.Debt 7.05b))
RoIC = 24.30% (NOPAT 4.51b / Invested Capital 18.58b)
WACC = 5.14% (E(59.60b)/V(69.03b) * Re(5.64%) + D(9.43b)/V(69.03b) * Rd(2.37%) * (1-Tc(0.15)))
Discount Rate = 5.64% (= CAPM, Blume Beta Adj.) -> floored to rf + 0.7*ERP = 7.95%
Shares Correlation 3-Years: -100.0 | Cagr: -0.65%
[DCF Debug] Terminal Value 80.82% ; FCFF base≈3.80b ; Y1≈2.50b ; Y5≈1.14b
Fair Price DCF = 9.95 (EV 36.30b - Net Debt 7.28b = Equity 29.02b / Shares 2.92b; r=5.90% [WACC]; 5y FCF grow -40.0% → 2.90% )
[DCF Warning] FCF declining rapidly (-40.0%), DCF may be unreliable
Revenue Correlation: 90.12 | Revenue CAGR: 14.04% | SUE: N/A | # QB: 0