FTSE 250 movers: Babcock gains after JPM lifts target price

FTSE 250 (MCX) 19,169.93 0.34%

Babcock shot higher on Thursday as JPMorgan Cazenove lifted its price target on the shares to 630p from 610p and upped its earnings per share estimates following the company’s capital markets day.

JPM increased YE March 2024-27 earnings per shares estimates by around 3% per annum, leaving it 6%/11%/11%/8% above Bloomberg median consensus in these four years.

The bank said its higher forecasts are driven by three takeaways from the CMD.

Firstly, the scope of infrastructure work in Babcock’s Devonport dockyard is greater than it expected.

Secondly, it pointed to the fact that Babcock has around £100m of incremental revenue from building military land vehicles, and thirdly, it noted the "overall positive tone" of the presentations.

JPM, which rates Babcock at ‘overweight’, said it thinks the 9% decline in the share price was a "very strange" reaction to the CMD, leaving Babcock "meaningfully" undervalued versus European defence peers and providing "a very attractive" entry point for investors.

Ashmore rallied a day after it reported that nervous investors pulled billions of dollars from the specialist asset manager's funds at the end of 2023.

Assets under management (AuM) were $54.0bn in the six months to 31 December, down 10% on the same period a year earlier.

Positive investment performance added $2.6bn to AuM during the period, but it was not enough to offset outflows of $4.5bn.

Media business Future gained after reporting on Wednesday that year-to-date trading had been "broadly in line with expectations", despite seeing a slowdown in digital advertising revenues and pressure from FX swings.

Market Movers

FTSE 250 - Risers

Ashmore Group (ASHM) 229.00p 8.33%
Babcock International Group (BAB) 456.00p 7.50%
Future (FUTR) 699.00p 5.11%
Me Group International (MEGP) 134.20p 4.03%
Tullow Oil (TLW) 30.08p 3.72%
Syncona Limited NPV (SYNC) 119.60p 3.46%
Bridgepoint Group (Reg S) (BPT) 268.20p 3.39%
Apax Global Alpha Limited (APAX) 157.00p 3.02%
AJ Bell (AJB) 326.80p 2.96%
Bytes Technology Group (BYIT) 647.50p 2.70%

FTSE 250 - Fallers

Bluefield Solar Income Fund Limited (BSIF) 105.20p -3.49%
Darktrace (DARK) 351.20p -2.63%
Kainos Group (KNOS) 1,118.00p -2.19%
Aberforth Smaller Companies Trust (ASL) 1,316.00p -1.94%
NextEnergy Solar Fund Limited Red (NESF) 78.70p -1.87%
Redde Northgate (REDD) 338.00p -1.74%
RIT Capital Partners (RCP) 1,858.00p -1.69%
GCP Infrastructure Investments Ltd (GCP) 70.50p -1.67%
Bakkavor Group (BAKK) 95.40p -1.65%
Barr (A.G.) (BAG) 543.00p -1.63%